£60m for Advantage West Midlands

The regional development agency Advantage West Midlands has launched a new £5m fund to help boost the future prosperity of the West Midlands. The Advantage Early Growth Fund is a key part of a strategy aimed at giving budding businesses the financial backing they need to expand. Small businesses are the lifeblood of the region but many struggle to develop because they cannot raise relatively small sums of capital. The fund, which was set up with £5m from the DTI’s Small Business Service Early Growth Fund, plans to make between ten and 20 investments a year, ranging from £10,000 to £100,000 and averaging about £50,000. Head of access to finance at Advantage West Midlands, Mary Martin, said: "We are delighted to be launching the third venture capital fund in the past year, all aimed at encouraging investment and growth in the region. The Early Growth Fund is vital because small, growing businesses need capital to fuel their expansion but often find it difficult to win the support of the High Street banks while most venture capital funds are looking to make larger investments in more established businesses. It is one reason why the West Midlands - despite its industry and inventiveness - has a relatively low rate for the formation and growth of small businesses. Having a growing number of small businesses is the foundation of future economic prosperity. This fund will help to encourage entrepreneurs to achieve their potential."

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