Igniting impact: How NPIF II is already generating value across the North

Simon Cunnington, Director at the British Business Bank explores the Northern Powerhouse Investment Fund II’s (NPIF II) first deals and the value they are bringing to the Northern economy.

Following its launch in March, the Northern Powerhouse Investment Fund II (NPIF II) has struck an impressive round of deals, already generating value across the North. The investments demonstrate the scope of businesses that can benefit from NPIF II funding and the range of finance options available, opening doors for business owners in the North.

Driving innovation, economic growth and job creation, the deals represent an exciting time for the Northern business landscape which, for NPIF II, includes the whole of the North East for the first time.

A fund reaching far and wide

Small businesses are the backbone of the UK economy, representing over 99% of the business population and accounting for 61% of UK employment. To support and accelerate the success of these businesses, NPIF II unlocks essential finance for businesses across the North and expands on the British Business Bank’s commitment towards ensuring that small businesses in the UK can scale up and grow.

The Fund aims to increase the supply and diversity of early-stage finance for Northern smaller businesses in multiple sectors across the whole of the North of England. This includes those who might be otherwise overlooked for investment, breaking down the barriers in accessing finance.

With the scope of the Fund spanning the entirety of the North for the first time, all regions can benefit from NPIF II, opening the doors to new opportunities for business owners from towns and cities, countryside to coasts. The North East and North West coasts of England in particular face higher income deprivation in their towns, highlighting the untapped potential of the regions. The first Northern Powerhouse Investment Fund made a significant proportion of its investments outside of the major cities and surrounding areas and NPIF II will continue to pave the way for inclusive and accessible growth for everyone.

The £660m Fund also provides greater flexibility and higher investment limits to further increase the attainability of the Fund. By providing loans from £25,000 to £2m and equity investment up to £5m, the Fund helps a range of small and medium sized businesses to start up, scale up or stay ahead. With these investments, NPIF II can provide value to everyone in the North through an adaptable and tailored approach.

Making a mark on the Northern economy

The NPIF II first deals are already igniting impact in the Northern economy, generating value across their regions. Expectations for the Fund are high on the back of the success of the first Northern Powerhouse Investment Fund, which provided more than £1bn of direct and private sector co-investment to businesses, creating over 8,000 jobs.

The first NPIF II investments alone are set to generate over 47 jobs in the North, with South Yorkshire legal technology firm, FinLegal, set to double its workforce, creating 26 jobs for the region. NPIF II isn’t only directly generating jobs through providing appropriate funding and support but is also addressing the skills gap across the UK. The first NPIF II deal to close in the North West was Liverpool based BioGrad Education, a business delivering skills bootcamps to help employers to respond to skills shortages nationwide.

The investments also display the ambitious and innovative nature of Northern entrepreneurs. FinLegal has found success overseas, with its services used by a leading legal claims firm in Australia. Family-run, Lancashire wood finishing manufacturer, Littlefair’s Wood Finishing Products, offers sustainable wood stains across the UK, Europe and America. In Newcastle-upon-Tyne, brand agency, B7, is venturing into new industries including AI and advanced technologies, using state-of-the-art equipment, technology and tools to ensure strategic and sustainable growth.

These ambitious businesses show the entrepreneurial spirit of the North, and how their potential can be unlocked through NPIF II to make a positive impact on the economy.

Creating a better future through NPIF II

The expansion of NPIF II to include the whole of the North East brings additional opportunities to achieve the Fund’s goal of increasing access to finance in underfunded areas and resolving regional imbalances.

This move comes as the North East champions net zero ambitions, decreasing emissions by 54% between 2005 and 2022. NPIF II’s aim to work with businesses at the forefront of sustainable transformation means we can expect to see sustainable businesses in the region securing the support and investment they need to drive the nation towards net zero. In the North East and beyond, Northern entrepreneurs are pioneering sustainable innovation, and NPIF II is working to provide a springboard for businesses to become ESG leaders and create a more sustainable future for everyone.

The future of the Northern Powerhouse Investment Fund II looks bright, promising to unleash the potential of entrepreneurs across the North, fostering growth, collaboration, and innovation. If you’re an ambitious entrepreneur looking for finance, there are several ways you can find out how the Fund can support you. Get in touch.

ENDS