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12/05/2015

FW Capital – an alternative catalyst for growth

*Article orignally in the North East Times.

Joanne Pratt, FW Capital’s Fund Manager in the North East explains why she believes alternative funders can offer small and medium-sized businesses (SMEs) a valuable source of long-term growth funding.

“Before the economic turmoil of 2008, funding sources for small and medium-sized businesses were limited to the banks, asset finance providers, invoice discounters and the odd public sector fund,” explains Joanne Pratt, FW Capital’s Fund Manager in the North East. 

“When FW Capital opened its first office in the North East in 2010 to manage the North East Growth Plus Fund, times were tough and many businesses were doing well to keep their heads above water.  At the time, FW Capital was one of the few funders in the region offering established SMEs an alternative funding source and we saw a good selection of potential investment opportunities from the types of businesses the fund was set up to back.”

Today, Joanne believes that the funding landscape is very different, with more alternative funders now providing established SMEs with much-needed funding that complements mainstream finance.  She also believes they’re here to stay: “With numerous alternative funders each offering something different, choosing the right funder is a crucial decision,” she continues. 

“At FW Capital we encourage businesses to think carefully about the funding they need as well as the provider they choose.  Making the right choice can play a critical part in their long- term success and could alleviate problems raising funds in the future.”

In 2013, FW Capital won another contract to manage the Tees Valley Catalyst Fund, a fund set up to help businesses win new contracts by providing them with short-term loan funding for performance and warranty bonds. Originally set up by Tees Valley Unlimited to assist Tees Valley-based businesses, this fund is now open to businesses across the whole of the North East.

With an experienced team of investment executives based at its offices in Newcastle and Billingham, FW Capital supports businesses throughout the region by providing finance to facilitate their growth  and its collaborative approach ensures that SMEs get a funding package that is right for them now as well as in the long-term be that debt, mezzanine or equity finance..

“Businesses grow in many different ways and we can now offer short and long-term funding options to ensure they successfully maximise their potential. We also work closely with other funders to come up with the right finance package,” Joanne continues. “My team has forged close relationships with the businesses we invest in, their advisers as well as other funders.”

FW Capital has so far made loans and other investments of over £23m to 37 established businesses in the North East. Businesses have used our finance for a variety of purposes including property or equipment deposits, working capital to fund growth into new markets, development of new products, staff recruitment and to take on new contracts. Joanne believes that FW Capital’s collaborative and flexible approach has resulted in some real success stories: “On average, businesses in our current portfolio have seen their turnover increase by 30 per cent **. Others have repaid our investments and attracted further growth funding from new investors.”

“When we assess an investment application we’re looking for a strong management team as well as robust financials and a credible business plan,” Joanne concludes. “We’re focused on the future viability, long-term success and economic impact of the businesses we invest in and we believe that businesses can best achieve this with a well-structured finance package.”

With funding available to support businesses in the North East with short and long-term investment packages from the North East Growth Plus and Tees Valley Catalyst Funds, Joanne and her team are keen to discuss their growth plans with them. 

** this is an analysis of our current portfolio one year following investment.

Call us on 0191 269 6969 or 01642 343 494  or contact us online.

 

www.fwcapital.co.uk/northeast