One of the region’s biggest investors of Advantage West Midlands’ cash still has £22 million to invest, meaning local firms will continue to benefit from the quango long after its demise

Midven runs several funds supported by the regional development agency, including the Exceed Fund which supports growing businesses, and the Early Advantage fund which looks after startups and high-growth firms.

The money from Advantage West Midlands had already been committed before the process of winding down the regional development agency started, meaning cash is safe for the ten-year lifetime of the two funds.

Combined together, Midven’s two funds, which also contain cash from Europe and private equity firm LDC, total £26 million over five years, of which £4 million has already been invested.

Over the life of the two funds, Midven expects to create or safeguard at least 1,000 jobs in the West Midlands area.

Advantage West Midlands’ investment funds are set to be transferred to a Government-owned body called Capital for Enterprise, but Midven chairman Brian Blakemore said the changes would have no impact on the cash available for local businesses.

“The money that they have committed will be put to good use in supporting SMEs in the West Midlands and promoting jobs,” he said.

Mr Blakemore, who has worked in the West Midland investment community for many years including several at Barclays Private Equity, said Midven was still seeing plenty of good quality firms looking for investment despite the uncertain economic backdrop.

And he stood up for the banks, saying in his experience they were not turning down good businesses for loans.

“In both the funds we’re still seeing a good flow of opportunities on a monthly basis, and we’ve seen no change in that,” he said.

“The one thing that surprised me slightly is that if you read the press, the banks are everybody’s whipping boy at the moment.

“One of the things they get criticised for is not supporting small businesses.

“We expected, particularly for the Exceed fund, to see a reasonable number of opportunities for existing businesses that were growing where the banks would not fund that growth. Actually that has not happened – we’re not seeing the volume that we were expecting.

“Either the banks are doing it or there aren’t the people out there that need that funding – probably a combination of the two.”

Mr Blakemore said Midven was investing in firms across the board for its two funds.

“We’re investing in things that at the one end look like exciting ideas that are in an early stage that could develop into an interesting product or service,” he said.

“At the other end we’re investing in established businesses that already have turnover and profits and good cashflow who are looking to accelerate their growth.”

He said that to date, Midven’s portfolio has done well throughout the downturn.

“Our portfolio has held up remarkably well through the difficulties of the last few years. Inevitably you’ve got one or two in a specific sector that might be affected, for example we have a business that provides services to local authorities.

“But in the main the portfolio has done very well and we’re seeing a good majority of our companies continuing to grow.”