An investment fund is to provide innovative SME businesses in the West Midlands with equity of up to 拢1 million, helping them to expand and grow the region鈥檚 industries of the future.
The West Midlands Co-Investment Fund, totalling 拢25m, has been set up by the West Midlands Combined Authority (WMCA) in partnership with West Midlands Pension Fund.
The investment partnership will look to invest in SMEs across a variety of sectors including green technology, advanced manufacturing, life sciences and creative and digital, helping them to scale up operations.
The WMCA is putting 拢12.5m into the fund and this is being matched by West Midlands Pension Fund. It will be managed by Midven, part of Future Planet Capital, through an investment team.
Operating over a 10-year period, the fund will focus on bringing new private investor money to the region and, using a co-investment model, will invest alongside business angels and other private sector investors on a minimum 拢1 to 拢1 basis.
Andy Street, Mayor of the West Midlands and WMCA chair, said: 鈥淪MEs are the lifeblood of our local economy so it鈥檚 vital that we improve their access to the finance they need to advance. These are exactly the sort of businesses that will help power our regional recovery and future prospects.聽
鈥淲e were the fastest growing region outside London in the decade leading up to the pandemic and we remain a hotbed of some of the best companies and brightest minds.
鈥淭hat鈥檚 why, together with the West Midlands Pension Fund, we鈥檝e launched the pioneering West Midlands Co-Investment Fund to back these very businesses. On a deal by deal basis the 拢25m will be matched by private investors to create a 拢50m-plus capacity.
鈥淲e have a wonderfully rich entrepreneurial legacy here in the West Midlands and the WMCA is determined to play its part in continuing that distinguished legacy in the months and years ahead.鈥�
West Midlands Pension Fund is one of the UK鈥檚 largest pension funds and it serves 800 employers who provide public services in the West Midlands and more than 340,000 active and retired individual members.
Cllr Milkinder Jaspal, chair of the WMPF Pensions Committee, said: 鈥淲e鈥檙e delighted to support this innovative partnership. The West Midlands Co-Investment Fund will build on the collaboration across the West Midlands and apply globally recognised sustainable investment practices to deliver both commercial return and social benefits.
鈥淚t will enable businesses where our members work and live to maximise their potential alongside generating growth to meet future pension benefits. It will support the technological advances we need to transition to net zero and attract further investment into opportunities for driving positive change through innovation.
鈥淎s the first fund of its kind, it provides an example of the power of local partnership working together for businesses, jobs and our members across the region.鈥�
It is claimed the fund could generate an extra 拢49m for the regional economy and create or secure nearly 800 jobs.