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CEF completes further investment in CoreRFID Limited
The Coalfields Enterprise Fund, established to support SMEs in the former English coalfield regions, has completed a further investment in CoreRFID Limited
CEF provides further funding to Caspian Learning Limited
The Coalfields Enterprise Fund has completed a further investment in North East-based Caspian Learning Limited as part of a £1.5 million funding round
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What is the Coalfields Enterprise Fund?
The Coalfields Enterprise Fund is a commercial venture capital fund set up to support the growth of businesses and encourage entrepreneurship in England's former coalfields. The Fund will bring over £20 million of new investment into these areas and finance new-start companies, established businesses seeking to expand, acquisitions and mergers, and buy-outs/buy-ins.
Who manages the Fund?
The Fund is managed by Enterprise Ventures Limited on behalf of the Department for Communities and Local Government.
Enterprise Ventures Limited is a leading provider of private equity and venture capital to high growth unquoted companies in the North of England and the Midlands and manages a range of funds that offer funding to new and existing SMEs across these regions.
Enterprise Ventures Limited is regulated by the Financial Services Authority and is a member of the British Venture Capital Association.
What is the Department for Communities and Local Government's involvement in the Fund?
The DCLG has provided £10m funding. The Fund has been established as a tax efficient limited partnership in line with the standard venture capital model. The DCLG will play a key role in monitoring the strategy and direction of the Fund, while leaving day to day management to the Fund Manager.
Who can the Fund help?
The Fund can assist new and existing SMEs, who require equity or mezzanine finance based upon the eligibility criteria.
What is the total size of the Fund?
The UK Government has provided £10m of funding. The Fund operates as a co-investment Fund, which means that this has to be matched by funding from other sources, so the total investment into the coalfields areas will be at least £20m
How many jobs will the Fund create/secure?
The Fund's business plan anticipates that it will invest in about 100 companies. The number of jobs safeguarded or created will depend on the actual companies that benefit from the Fund. It is too difficult to estimate the exact figure at this stage, but it is expected that the Fund will have a very positive effect on jobs created and/or secured.
How does the Fund invest in companies?
All investments are made on a commercial basis and the Fund Manager will put together individually tailored funding packages comprising equity and/or mezzanine finance for the companies in which they invest, to allow the companies to grow and develop. Investment ranges from £40,000 to £500,000 with the maximum investment allowed in any one company being £500,000.
How much will the Fund invest in my company?
The Fund is able to invest in the range of £40,000 to £500,000 in any one company.
What if my funding requirement is more than £500,000?
The Fund’s maximum investment in any one company is £500,000 – should your funding requirement be in excess of this amount, you will need to identify other sources of finance to make up the remaining requirement. EV will be able to help you do this. Keep in mind that the Fund requires 50% match funding from other funding providers.
Do I need to talk to other investors as well as CEF?
The Fund is able to offer up to 50% of the total funding package, up to a maximum of £500,000 in to your business and therefore the Fund’s investment must be matched from another private sector source. In many cases, this matched funding will be a bank or an invoice discounting company. Borrowings under the Small Firms Loan Guarantee Scheme are eligible in this regard.
Does the Fund provide follow-on funding?
Follow-on funding is available, with the maximum total investment in any one company being £1 million, subject to the 50% matched funding requirement.
How long does the application process usually take?
It is likely to take in the order of eight weeks from the date of receipt of a business plan until an approved investment is completed. This process can be shortened in some circumstances and the investment team’s desire is always to proceed as quickly as possible.
How much will it cost?
The Fund requires an arrangement fee which is negotiable, up to a maximum of 3% of the total monies invested, payable om completion of the investment. The Fund also reserves the right to charge a monitoring fee of 1% per annum of the total investment made by the Fund.
Whilst the aim is to keep costs to a minimum, fees will also be incurred in completing the legal documentation and potentially with regard to due diligence and referencing work.
What information do you need me to provide?
For an investment to be considered, we require a full business plan, including P&L, Balance sheet, cash flow forecasts and projections.
Will the Fund want a seat on the Board?
The Fund Manager actively seeks to add value to your business and focus on its growth and development. In most cases, the Fund reserves the right, which may or may not be exercised, to appoint a Non Executive Director to the Board, usually an external independent director of the highest calibre who will add to and enhance your existing management team.
My company is not located in an eligible area but is considering relocating – can I apply?
Certainly – the Fund is happy to consider proposals from companies outside the eligible areas that are intending to relocate into an eligible area. However, it is not always necessary to be located within an eligible ward – companies who employ a significant proportion of their workforce from, or who bring material economic benefit to, an eligible ward can also apply for funding.
Can the Fund invest in businesses located in Wales and Scotland?
The Fund operates in the coalfield areas of England only.
Do I have to be an ex-coalminer to apply?
No, your business needs to be eligible based upon the Fund’s eligibility criteria.
Are there any businesses the Fund cannot invest in?
The Fund is able to invest in most sectors although is not able to provide funding to businesses operating in those sectors normally excluded under State Aid rules – for a list of the excluded sectors please contact the Fund Manager, who will be able to provide further details.
How and to whom do I apply?
All enquiries and applications should be made directly to the Coalfields Enterprise Fund investment team at Enterprise Ventures who will be happy to discuss your requirements with you or receive your written approach to funding.