Nick Butler: Investing now in tomorrow’s success stories

Despite the economic concerns, there are strong indications that Yorkshire is poised for success with many high-growth small and medium-sized companies offering viable business propositions and, equally, there is significant investment available.

At Connect Yorkshire, as a not-for-profit organisation straddling the private and public sectors, we are in a position to see the bigger picture with an unbiased view – of emerging and developing SMEs showing real growth potential, many offering cutting- edge products and services that we believe will become market leaders in their field, and of multi-million-pound funding that is available.

There are always opportunities for companies with exciting or interesting products or services. Where banks have failed, equity providers have stepped into the breach and provided some debt funding as well as equity funding. Individuals and organisations need to know that funding is there; often they have viable products but not the know-how to obtain funding, which is where we help.

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Our recent Investment Forum, held in York, was attended by more than 80 companies and by venture capital companies with a collective amount of more than £500m to invest. There were 10 companies pitching for £11m of investment – to date, eight of these companies are in detailed discussions with potential investors.

SMEs are the lifeblood of the economy; we have helped more than 300 companies achieve more than £44m of international investment over the last decade and are working with small but fast growing companies across Yorkshire which have real potential.

Yorkshire has a culture of discovery and success that has been honed over centuries. While demographics change, many of us originate from people with a hard working ethos and a strong entrepreneurial drive that is synonymous with Yorkshire; those of us who come from outside the county recognise a culture of drive and achievement, which has created an environment of opportunity and growth.

For decades, Yorkshire has bred pioneering people with great vision across business, science, medicine, travel and exploration and the arts. From inventing concrete and stainless steel to cat’s eyes and hydraulic engineering, major industries have been developed in wool, textiles and steel that gave significant economic growth and generated great wealth, thousands of jobs and a hard-working population.

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Yorkshire people are careful with money – stereotypical, but true – which has served the region well; keeping good reserves has helped many companies to survive and prosper during hard times.

At Connect Yorkshire, we are seeing not only start-up companies but developing firms wanting funds to continue their growth; organisations that are bringing exciting products with great potential to the market.

I believe that it is not just down to the banks to have funds available for lending – people need to ask for funding, to act on ideas and to have confidence in themselves, their products and the market.

It is heartening that this year for the first time for several years, a bank, namely NatWest, joined the 40-plus professional service firms who sponsor Connect Yorkshire.

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Having banged my head against the brick walls of the banks during the boom years, I am no fan of them, and at the SME level you see the banks’ need to build their own balance sheets, leading to overdrafts being reduced, facilities being withdrawn, and respectable and bankable propositions coming to Connect Yorkshire to try for equity funding.

Despite global issues, there are always opportunities, but continuing talk of economic gloom creates inertia so that recession becomes a self-fulfilling prophecy.

This is a time of great optimism – with the internet, virtual offices and communications technology, there has never been an easier time to set up a business with minimal overheads.

It is also vital that the Government keep its promise to help fund the region; with the imminent demise of Yorkshire Forward and funding becoming centralised, the newly-formed Local Enterprise Parnerships will provide a channel to help the region, but they have no money.

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The Government say they are trying to help SMEs. Yet one recent business coaching contract, by its very terms, excludes smaller companies to tender and the project may be won by larger companies, typically located down south.

We need to keep funding in the region for the region and not be hi-jacked by outside organisations.

Working alongside many exciting projects and people with a hunger for success, the picture looks very promising.

Now is the time to focus on the future, to have confidence, to strive ahead and once again, show the UK and world forum, the success that Yorkshire has continually demonstrated throughout our history.

Nick Butler is chief executive of Connect Yorkshire, a not-for-profit company that helps growth businesses acquire equity funding and expertise.