KC to give start-ups helping hand through investment fund

The Hull-based company, a subsidiary of stock market listed KCom Group, provides telephone and internet services to homes and businesses in East Yorkshire.

Yesterday it launched a £300,000 investment fund – matched with another £300,000 from the European Regional Development Fund – which it will lend to new and growing businesses in East Yorkshire.

KC said the fund was established in response to public sector cutbacks and lack of financing for small business. Companies will be able to borrow between £1,000 and £25,000 from the fund called KC Invest. Loans will typically span three years, with interest charged at 14 per cent.

“Banks these days are extremely cautious,” said Sean Royce, KC’s commercial and finance director. “The benefit for us is we’re supporting the social fabric here. With the public sector cuts, particularly Business Link and Yorkshire Forward... it’s time for the private sector to stand up and fill the gap. This is not about making money.” Successful applicants will also receive mentoring from KC employee volunteers.

Mr Royce called on other large East Yorkshire firms to support start-up industries in their own sectors.

He said the investment fund has had an “awful lot of interest” from other corporates since it was first revealed at the Yorkshire International Business Convention in June.

“Our vision is to establish a consortium of leading local businesses who can provide financing and mentoring to start-ups from a range of different industries, using the blueprint we have now established,” said Mr Royce.

The fund includes some grant support to pay for market research and feasibility studies.

KC Invest will be administered by enterprise agencies the Acorn Fund and Sirius and eligible companies must be based in Hull or the East Riding of Yorkshire.