Enterprise Capital Fund

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Enterprise Capital Fund is a British government financial programme that provides venture capital funding to Start-up companies that is operated by the British Business Bank.

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It was established in 2006 by the UK governments Department for Business, Innovation and Skills (BIS) in the United Kingdom to address a market weakness in the provision of equity finance to UKs small and medium enterprises (SMEs). [1]

Government funding is used alongside private sector funds to establish funds that operate within the "equity gap"; targeting investments of up to £5 million that have the potential to provide a good commercial return. [2]

History

The first five funds supported under the scheme were launched in 2006-7 following a pathfinder competition. A further three funds were awarded ECF status in 2007.

As of 1 April 2008, responsibility for the management of ECFs along with BIS's other equity funds and the Small Firms Loan Guarantee (SFLG) was transferred to a new body, Capital for Enterprise Limited (CfEL). This change did not change the nature of the funds or their policy objectives.

CfEL was incorporated in March 2007 as a private limited company wholly owned by BIS, [3] and commenced actively trading in April 2008. It was an asset management business specialising in designing and managing support programmes for SME finance. Its position in the SME finance markets provided it with a unique ability to inform and implement Government policy on those markets.

In November 2013, Enterprise Capital Funds came in for scrutiny from the European Commission after several UK government-backed funds were found to be investing in SMEs beyond the guidelines permitted by EU law. One implication was that such businesses could have been forced to hand back millions of pounds to HM Treasury. [4]

On 1 October 2013, CfEL became part of the British Business Bank, which is now responsible for the management of all of CfEL's financial schemes, including ECFs. [5]

As of November 2019, 29 ECFs had been launched.

Approved funds

Funds as of March 2017 were:

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References

  1. "BIS page Enterprise capital funds". Department of Business Innovation & Skills. Archived from the original on September 3, 2009.
  2. "The Enterprise Capital Funds programme". British Business Bank . Retrieved June 22, 2024.
  3. "About page on CfEL web site". Archived from the original on 2013-05-21.
  4. Fontanella-Khan, James; Rigby, Elizabeth (20 November 2013). "UK SMEs face Brussels probe over state funding". ft.com . Retrieved 21 November 2013.
  5. "Capital for Enterprise Limited". British Business Bank. Archived from the original on 2014-02-21.
  6. "MMC Ventures Enterprise Capital Fund". MMC Ventures. Archived from the original on May 12, 2020.
  7. "Panoramic Growth Equity".
  8. "Seraphim Capital - we're specialist investors in the Space ecosystem". Seraphin Capital. Archived from the original on February 18, 2020.