GVOC – Funding Advice Workers

Susan OliphantHead of Operations / Business Development

25 May 2011

Agenda

• Entrust – background / who we are / what we do

• Microloan Fund

• Other programmes:– Investor Forum

– Pathfinder

– Home Working Fund

– Service Network

– Business start-up

– Mentor Database

Entrust: who we are…

• Small group of companies, not for profit, limited by guarantee:– Tyne & Wear Enterprise Trust Ltd t/a Entrust Ltd– Entrust Fund Management Ltd– North East Equity Matching Ltd– Street North East Ltd – Financial Inclusion Newcastle Ltd (FIN)– Service Network (North East) Ltd

• Turnover 2010-11 - £2.3m / 25 staff

• Work across the North East region

• Money, Markets, People

Entrust: who we work with…

• Pre-start: individuals thinking about starting up in business

• Start-ups: those who are “on the journey”

• Existing businesses: often (but not always) SMEs with fewer than 250 staff

• Existing businesses that have ambitions to change and grow

• Existing businesses that are “in pain” but, given the right support, have a future

• £15m under management – loans and equity

• We manage funds; we have our own loan fund (Street North East)

• Financial packaging – cocktails: business planning and sourcing public / private funding

• Pathfinder: helping businesses to re-organise and restructure financials

• Business Angel Network: Investor Forum - established 1994

Money…

– Regional Enterprise Loan Fund

– CDFI Pilot

– Transitional Loan Fund

– Street North East Loan Fund

– North East Equity Matching Fund

– North East Microloan Fund

Funds under management…

Microloan Fund / “JEREMIE”

• Part of Finance for Business North East “super fund” - £125m

• Previously referred to as “JEREMIE”– Single Programme– ERDF– European Investment Bank (EIB) - £62.5m loan to be repaid on

commercial terms

• Businesses Supported – 850

• Jobs Created and Safeguarded - 7,818 over 10 years

• INVEST for returns; do not give grants

Microloan Fund - Objectives

• Increase the creation of new enterprises

• Improve the survival rates of new businesses

• Improve the growth rate and profitability of existing micro and small businesses

• Support businesses where mainstream lending is unavailable

• Create and safeguard jobs

Microloan Fund – Customer Groups

• Individuals starting business who face some form of disadvantage (e.g. Unemployment, disability, residence)

• Individuals starting business who are not disadvantaged but unable to source mainstream finance

• Existing sole traders and partnerships

• Existing micro and small limited companies

• Social (Third Sector) Enterprises

Microloan Fund – Loan Criteria

• Amounts £1k - £25k

• Term Up to 3 years

• Interest Rate 6.5% above UK Reference Rate

• Security Unsecured

• Purpose Normal business requirements

Microloan Fund – Key Figures

• Loan capital £5m

• Lending period To December 2014

• Number of Loans 700+

• Output targets– New businesses 400+– Existing businesses supported 275+– Jobs created & safeguarded 1100+

Microloan Fund - Eligibility

• Located in North East of England

• Viable but unable to raise funds elsewhere

• Must not operate in excluded sectors

• Must be an individual or an established SME / Third Sector organisation

“Retail”

Draft CLG Guidance:

• “Permitted to lend to viable SME retail businesses who are unable to raise all or some finance from private lenders”

• “Dispensation to support SME retail businesses, particularly on lending, is especially likely to benefit women and members of certain social groups (including but not exclusively BME groups), and likely to help activity in certain economically deprived geographic areas”

“Investment Readiness”

• “Loan repayment ready”

• Application Form– Business Plan / Overview of Business

– Balance Sheet

– 12 month cash flow forecast

– 12 month P&L forecast

– Personal budget

– Business Assets & Liabilities

• 3rd Sector Capacity Fund / North East Enterprise Agencies - ERDF

Investor Forum

• “Dragons’ Den….with Manners!” – formal Business Angel Network

• Brings together investment community in the region – high net worths / venture capital funds / those who manage others’ wealth / professional service firms

• Showcases high-growth, knowledge based companies

• Presentation events 5-6 times/yr involving 4 or 5 pre-vetted investment opportunities

• Companies are given 10 minutes to make their presentation followed by a question and answer session

• Coaching for the event

Investor Forum

• 17 February 2011:– 60 delegates

– 17 registered business angels; 4 “super angels”

– 6 Fund Managers

– 4 private wealth managers

• In last 12 months:– 30 companies have pitched for £14.5m investment

• In 2009-10:– Helped companies raise £5.9m

• Pathfinder: short-term problems but with potential for sustainable growth – 5 days 100% subsidised (ERDF)

• Home Working: £1.1m fund to create 360 new home working jobs in the North East - £3k subsidy per FTE

• Service Network: membership organisation for business to business service providers – not just private sector:– Talent management

– Winning new business

– Service differentiation

– Tomorrow’s world

• Business start-up

Other services:

For more information:

www.entrust.co.uk

0191 244 4000

Bringing a New Dimension to Business Support