Venture capital fund for local businesses

New £40 million investment funds to boost enterprise in disadvantaged communities by increasing access to finance for local entrepreneurs has opened for business.

The Bridges Community Development Venture Funds, supported by £20m of Government money and £20m from private investors, will invest only in businesses that will regenerate local economies in the most deprived areas of England. The Funds are launched as new figures from the British Venture Capital Association show a record rise by 24% of investment in UK start-up companies.

Speaking at a breakfast event for investors in Downing Street Chancellor Gordon Brown said:

"The key to neighbourhood renewal is not more benefit offices but more businesses, which is why these new Funds are crucial to opening up opportunities and encouraging and rewarding enterprise. They will help dynamic and fast-growing enterprises to prove that deprived areas are not no-go areas for business but sources of future growth and entrepreneurship".

The funds will be run as commercial operations by a newly established management team of professional venture capitalists, operating on standard venture capital principles. This means that they will look to provide capital to businesses that will be successful and grow strongly, bringing deprived areas the growth-enhancing benefits of the venture capital model.

To be considered for investment, businesses must have the following characteristics: