£660m Northern Powerhouse Investment Fund II preparing for 2024 launch

The British Business Bank is preparing to launch a second Northern Powerhouse Investment Fund totalling £660 million to support the region’s SMEs.

Ahead of the planned launch in 2024, The British Business Bank is also inviting proposals from potential fund managers to operate the Northern Powerhouse Investment Fund II.

The fund will offer a range of commercial finance options with loans from £25,000 to £2 million and equity investment up to £5 million. The new fund will cover the entire North of England including Greater Manchester, Liverpool City Region, Lancashire, Yorkshire & the Humber, Cheshire & Warrington, Cumbria, County Durham, Tyne & Wear, and Northumberland.  The fund will address an identified funding gap in the North of England and increase the supply and diversity of early-stage finance for smaller businesses.

The Northern Powerhouse Investment Fund II is one of a series of new Nations and Regions Investment Funds, which will deliver a £1.6 billion commitment of new funding to drive sustainable economic growth in all corners of the UK. Similar funds are launching for the South West, Wales, Scotland and Northern Ireland, along with a follow-on fund for the Midlands.

The British Business Bank aims to build on the successes of the first Northern Powerhouse Investment Fund, Midlands Engine and Cornwall and Isles of Scilly investment funds, which have collected supported more than 1,800 smaller businesses and supported a further £1 billion in private sector investment.

Ken Cooper, Managing Director, Venture Solutions, at the British Business Bank, said:

“The launch of the Northern Powerhouse Investment Fund II builds on the success of its predecessor. It will further increase the supply and diversity of early-stage finance for smaller businesses in the region, providing finance for firms that might otherwise not receive investment and helping to break down barriers in access to finance.

“The first Northern Powerhouse Investment Fund has facilitated the investment of more than £1 billion into northern businesses since it launched, and has been instrumental in the creation of thousands of new jobs and opportunities. We know that the levels of private debt lending and equity investment in the North of England remain below expectations given the region’s share of the UK’s smaller business population and that is something this next generation of the fund will continue to address by backing ambitious businesses that will drive sustainable economic growth.”