Scottish Enterprise to work with Scottish Government to explore plans for Scottish Investment Bank
Scottish Enterprise announced today (21 April 2009) that it has secured £39.2 million in European funding to support projects that will help stimulate business growth in the current economic climate.
The funding secured includes an additional £20 million for the Scottish Venture Fund, the single largest Scottish award made in this round of European Regional Development Funding (ERDF).
Scottish Enterprise also highlighted that it will work alongside the Scottish Government to explore proposals for a Scottish Investment Bank, which will bring together the Scottish Co-investment Fund, Scottish Venture Fund and Scottish Seed Funds,
Scottish Enterprise’s range of equity investment funds are designed to encourage greater levels of risk capital investment in Scottish early stage companies. Despite the economic downturn, there was a record number of investments in 2008, helping to boost business growth and provide investment for Scottish companies.
Other Scottish Enterprise projects which will benefit from the £39.2 million ERDF funding include:
- £4.9 million for Scottish Enterprise’s Business Efficiency programme, helping growing Scottish businesses to reduce costs and improve efficiencies.
- £1.5 million will support the development of the Energetica business site, which aims to create the world’s greatest concentration of energy technology companies, housing and leisure facilities along a 30-mile coastal strip between Peterhead and Aberdeen.
- Rural business property support will benefit by £385,000, with the South of Scotland region securing £320,000.These projects provide support for capital investment in the creation of new sites or premises, or the extension or adaptation of existing buildings, for rural businesses.
Commenting, Jack Perry, chief executive of Scottish Enterprise, said: “The level of ERDF funding we have secured is a huge endorsement of our work in supporting innovation, the commercialisation of research and development and investment in Scotland’s high growth businesses. The funding secured for the Scottish Venture Fund is particularly pleasing, as it will allow us to increase the availability of risk capital for some of Scotland’s most promising companies.
“I am also looking forward to working with the Scottish Government to explore their proposals for a Scottish Investment Bank. Over the past year, we’ve seen record demand for our investment products. The number of investment deals last year rose by 49 per cent and the value of deals also increased to hit a record £29.7 million, so we are confident that there is still a healthy appetite for equity investment from all parties.”
About Scottish Enterprise investment funds
The Scottish Co-investment Fund (SCF)
The Scottish Co-investment Fund is a £72 million equity investment fund set up by Scottish Enterprise (and part funded by the European Regional Development Fund (ERDF)) to invest from £100,000 to £1 million in company financing deals of up to £2 million.
The aim of the SCF is to help young, cutting edge companies realise their high-growth potential by ensuring they can access equity investment. The fund provides equity funding to SMEs on a co-investment basis with selected private sector investors. It does not find and negotiate investment deals on its own.
Since its launch, the SCF has completed 298 deals in 134 companies, with almost £45 million investment from SCF leveraging a further £95 million of private sector investment.
Find out more about the Scottish Co-investment fund
The Scottish Seed Fund (SSF)
The Scottish Seed Fund provides equity from £20,000 to £100,000 to early-stage businesses keen to grow and which meet various criteria relating to their size and commercial viability.
The SSF invests in start up and very early stage growing businesses as part of a larger funding package, and matched at least on a £1 for £1 basis by the private sector. Since its launch, the SSF has completed 44 deals in 44 companies, with £3.8 million investment from SSF leveraging a further £6.5 million private sector investment.
Find out more about the Scottish Seed Fund
The Scottish Venture Fund (SVF)
The Scottish Venture Fund is a co-investment fund set up by Scottish Enterprise to invest up to £2m in equity finance deals alongside private sector partners. It is aimed at high growth companies across a wide range of sectors and will involve equity finance deals of between £2 million - £10 million. The SVF has completed 18 deals in 18 companies, with almost £20 million investment from SVF leveraging more than £40 million further private sector investment