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Nearly half a billion pounds invested by private capital firms in Yorkshire and North East, finds new report

Publish Date 8 Feb 2022
Categories Research
Private equity and venture capital recognise the regions as prime areas for investment, supporting companies of all sizes to innovate and flourish.

Nearly half a billion pounds (£480m) was invested into businesses in Yorkshire and the North East by private capital firms in 2020, a new report sets out today.

This investment is powering SMEs across the regions, with 9 in 10 businesses supported there employing 250 or fewer people.

Statistics in the report go on to show that, of all UK businesses backed by private equity and venture capital in 2020, one in eight (13%) were located in Yorkshire and the North East.

Produced by the British Private Equity and Venture Capital Association (BVCA), its ‘Nations & Regions’ report looks at investment activity across Yorkshire and the North East – identifying them as hotspots for private capital activity.

It uses data and case studies gathered from across the BVCA’s membership to provide an in-depth look at how they support businesses across the regions to grow with capital, management expertise and long-term partnerships.


Key findings include:
  • Of all businesses supported by BVCA members in 2020, 1 in 8 (or 13%, representing 168 companies) were located in Yorkshire and the North East.

  • These businesses received £480m in funding during the pandemic – a time when it was needed most.

  • 9 in 10 of the companies supported were small or medium-sized, employing 250 or fewer people.

  • Tech was the most attractive area for investment across the regions, with 47% of all businesses backed in Yorkshire and the North East being in this sector. Businesses in the consumer goods and services (18%) and healthcare (12.5%) sectors also saw substantial support.

  • Of the companies supported in the North East, the majority (66) were in their early stages – speaking to the region’s vibrant start-up economy.

  • In Yorkshire, companies invested in were more mature, accessing £360m – collectively – to help them scale.

READ THE REPORT


Providing comment for the report, Ben Houchen, Tees Valley Mayor said:

“The North East is a fantastic place to start and grow a business, which is why so much investment is coming from private capital firms to this region. As Tees Valley Mayor I have the pleasure of visiting fantastic companies like Nova Pangaea Technologies every week across Teesside, Darlington and Hartlepool to see their amazing work first-hand. Businesses like Nova Pangaea are developing ground-breaking technologies that will supercharge our local economy and create the skilled, well-paid jobs we want to see in Teesside and the wider North East. This report shines a spotlight on our region and highlights why the North East’s economy is a business power-house.”


Michael Moore, BVCA Director General, said:

“Private capital firms are alive to the many remarkable opportunities Yorkshire and the North East have to offer – be it the emerging tech start-ups in cities like Newcastle and Durham, the world-leading research-led businesses growing out of the region’s universities or the already-established companies with scope to flourish at a global scale.”

“Private equity and venture capital can, and are, helping these businesses to thrive. Together we’re creating jobs, supporting individuals and communities and shoring up regional economies in the wake of the pandemic.”

The report also comprises a number of new case studies, looking in detail at some of the exciting, innovative and growing success stories supported by BVCA members across Yorkshire and the North East.


These include:
  • Newcells Biotech, based in Newcastle and supported by Northstar Ventures, which began life as a research project in Newcastle University and now enables scientists to create cells in a lab environment which can then be tested for reactions against drugs in development.

    Dr Mike Nicholds, CEO of Newcells Biotech, said: “The support from venture funding providers like Northstar Ventures is critical to companies like Newcells. Commercialising new science requires early stage support to develop ideas into technology and then to products. Alongside investment we benefited from advice on strategy which helped prepare use for further growth funding to scale-up our business and launch new products”

  • Clearly Drinks, a soft drinks manufacturer headquartered in Sunderland and supported by NorthEdge Capital.

    Mick Howard, Chief Executive of Clearly Drinks, said: “From the start of our journey together, NorthEdge have been superb and nothing but supportive. They’re an organisation that are easy to work with, grasping very quickly what we wanted to achieve here, and have worked with us – side by side, every step of the way – in true partnership style”

  • Rosemont Pharmaceuticals, based in Leeds and supported by Inflexion.

    Howard Taylor, Chief Executive of Rosemont Pharma, said: Inflexion brings a number of strengths to our business, firstly a challenging mindset stimulating management to think about being more ambitious. They are agile but approachable. We knew what we wanted to achieve with business, it was just being given the playing field to actually bring it to life, and the Inflexion relationship has allowed us to do that"

More about the ‘Nations & Regions: Yorkshire, the Humber and North East England’ report

The publication goes on to provide new analysis from the BVCA, the British Business Bank and Pinsent Masons LLP on the regions’ private capital ecosystem and why Yorkshire and the North East are attractive places to start and grow businesses.

Additionally, there are features on regional initiatives such as the Northern Accelerator Programme – a partnership between Durham, Newcastle, Northumbria, Sunderland and Teesside University which connects academics with business leaders – and Fund Her North, which gives Northern, female entrepreneurs equal access to funding to help them successfully scale their companies.


READ THE REPORT



Notes to editors
  1. Read the report, in full, here.

  2. For more information on any of the above, please contact the BVCA’s External Communications Manager, Will English, on wenglish@bvca.co.uk.

  3. The British Private Equity & Venture Capital Association (BVCA) is the industry body for the UK private equity and venture capital industry. The BVCA has over 750 member firms, including more than 450 fund managers and institutional investors, representing the majority of UK-based private equity and venture capital firms and their advisers.