£10m pilot scheme launched to attract more investment into Welsh businesses
Mark Mansfield
A new £10m scheme has been launched to attract more institutional investment into growing Welsh businesses.
The Development Bank of Wales’ Equity Co-investment Scheme will provide matched investments of between £500,000 and £2m alongside private investors.
Funding will be available as part of investment rounds worth up to £10m, with the pilot aimed particularly at companies commercialising technology and looking to expand while remaining based in Wales.
Businesses applying for funding will need to secure backing from an FCA-registered lead investor whose funds are predominantly supported by private-sector institutional capital.
The Development Bank will then invest on the same financial and legal terms as the lead investor.
The £10m allocated to the pilot has been ring-fenced from the existing Wales Flexible Investment Fund.
Welsh Government Cabinet Member for Enterprise, Connectivity and Energy Adam Price said: “Helping more Welsh businesses to scale is a key focus of our vision to unleash the full potential of our economy.
“Active capital of the sort provided through this important pilot scheme does more than just provide funding. It brings expertise, networks and long-term backing that can help businesses grow faster and improve productivity, supporting sustainable economic growth across Wales.
“This initiative also builds on the Development Bank’s unique work supporting Welsh businesses and will strengthen the wider investment ecosystem in Wales.”
The scheme follows previous deals in which the Development Bank has invested alongside institutional and other private investors.
These include Welsh medical technology companies IQ Endoscopes and Ceryx Medical.
Last year, the Development Bank joined BGF, Parkwalk Advisors, the Bristol Private Equity Club and other investors in a £5m funding round for Ceryx Medical.
Entrepreneurs
Hannah King, an investor with BGF, said: “Wales has a strong base of entrepreneurs that can benefit from initiatives that improve the funding environment.
“BGF has a long-standing commitment to backing ambitious Welsh businesses, and we’ve seen first-hand the value that investors can bring by working together.
“Our previous collaborations with the Development Bank of Wales, including investments in IQ Endoscopes and Ceryx Medical, demonstrate how co-investment can support companies as they scale.”
Development Bank Technical Investment Director Chris Griffiths said: “This pilot gives us a practical way to move faster while continuing to invest with commercial discipline.”
The Welsh Government-owned Development Bank was established in 2017 and provides loans and equity investment to businesses and property developers.
It has invested more than £1.1bn since its launch and attracted more than £680m of additional co-investment.
Support our Nation today
For the price of a cup of coffee a month you can help us create an independent, not-for-profit, national news service for the people of Wales, by the people of Wales.
Get more trusted Welsh news
Choose Nation.Cymru as a preferred source in Google News to see more of our journalism.
