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SMALL BUSINESS FINANCE
MARKETS REPORT 2017/2018
SMALLER BUSINESSES’ USE OF FINANCE DIVERSIFYING IN 2017/18
£
value of smaller business
asset fnance deals
value of peer-to-peer
business lending
number of smaller business
equity fnance deals
Up
51%
value of smaller
business equity
fnance deals
Up
79%
Up
12%
Up
12%
A THRIVING START-UP CULTURE
5.7m highest ever UK
business population
new record for
start-ups in a year
414,000
35%
of employer
enterprises
are start-ups
THE BANK LENDING PICTURE
REGIONAL IMBALANCES IN EQUITY INVESTMENT
net bank lending - still positive,
although down on 2016
of smaller
businesses
confdent they’d
get a loan if
they applied
of smaller businesses sought
new loans in last 2.5 years
of smaller business loan
applications approved
of smaller
businesses
would rather
forgo growth
than borrow
of the UK’s business population is in London
but
19%
of UK equity
investment deals are in
London
52%
£0.7bn
1.7%
72%
70%
43%
£
SCALE-UP BUSINESSES NEED MORE LONG-TERM PATIENT CAPITAL
£118m
average UK
VC fund size –
one third smaller than in the US (£180m)
average number
of rounds of UK VC
funding for businesses
that exit (US average
2.7 rounds)
1.9
£13bn
long-term patient capital to be
unlocked by British Business Bank
UP TO
A full list of sources is provided in the Small Business Finance Markets Report 2017/18,
available from the British Business Bank website
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BRITISH BUSINESS BANK
REGIONAL FUNDS
NORTHERN POWERHOUSE
INVESTMENT FUND REGION
MIDLAND ENGINE INVESTMENT
A full list of sources is provided in the Small Business Finance Markets Report 2017/18,
SMALL BUSINESS FINANCE MARKETS
REPORT 2018 – THE REGIONAL PICTURE
SHARE OF BANK BUSINESS LOANS (NUMBER)
PER REGION RELATIVE TO BUSINESS POPULATION
SHARE OF EQUITY DEALS (NUMBER), RELATIVE TO
NUMBER OF HIGH-GROWTH FIRMS
THE UK’S EQUITY INVESTMENT HOTSPOTS
LOCATIONS INVESTED IN BY BUSINESS ANGELS
12%
East of England
15%
Scotland
North East
5%
Yorkshire
58%
London
5%
East Midlands
South East
33%
12%
South West
5%
Wales
8%
North West
8%
West Midlands
6%
Northern Ireland
5%
69% invested inside
their home region
59% invested outside
their home region
NB: percentages total over 100%
as some angels report investing in
more than one region
FUTURE DEVELOPMENTS
FOR THE REGIONS
In response to the government’s
Industrial Strategy, we are developing
an investment programme to support
the growth of clusters of business
angels outside London, and putting
in place a network of British Business
Bank regional managers.
% of loan
% of GB
facilities
business
approved
population
2017
London
13.3
19.1
South East
11.8
16.7
South West
12.7
9.6
East Midlands
6.4
6.7
West Midlands
7.6
8.1
East of England 8.9
10.3
Yorkshire and
Humberside
6.2
7.5
North East
4.2
2.6
North West
12.1
9.5
Wales
6.3
3.8
Scotland
10.5
6.2
much above average
above average
average
below average
much below average
Software
Business and Professional Services
Life Science
Industrials
Glasgow
Manchester
Liverpool
Birmingham
Bristol
Oxford
Cardif
Brighton and Hove
Leeds
Cambridge
Edinburgh
Newcastle-upon-Tyne
Shefeld
London 1
London 2
FUND REGION
CORNWALL AND ISLES OF
SCILLY INVESTMENT FUND
(TO BE LAUNCHED)
% of total
% of total
number of UK
number of
Equity Deals
UK HGB
(Q4 2016-
(2015)
Q3 2017)
London
South East
Scotland
East of England
North West
South West
Wales
Yorkshire and
Humberside
West Midlands
North East
Northern Ireland 1.6
2.2
East Midlands
1.4
7.0
52.1
19.8
10.7
15.0
6.5
6.8
6.0
8.7
5.6
10.5
5.4
8.5
3.0
3.6
2.9
7.6
2.6
7.4
2.1
3.0
much above average
slightly below average
below average
much below average
available from the British Business Bank website