The Northern Powerhouse Investment Fund 4 £28m 124 £83m “The Debt Fund” regional offices staff Direct investment Impact on regional £100k to £750k economy Simon Berry 15/11/2019
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A loan is like your kids or a very old house…… 3
“ A loan needs to be serviced by the surplus cash generated by the businesses primary activities, after meeting all its operating costs” “This surplus cash needs to come from “trading income/profitability”. Let us talk briefly about grants and cash expected to be received from further fund raising rounds (equity). 4
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You approach us for a loan Are you We undertake our prepared? due diligence • Historic financials • Latest current financials _______________________ • Sales pipeline • Business Plan/Pitch Deck/IM • Financial Projections 6
Let us know everything we need to know at the outset 7
Our USP’s Our lending is all Other lenders about cash flow • We can use management accounts as • Other main stream lenders tend to focus evidence that trading performance has on historic performance and want to improved since the last Y/E. wait until next years full accounts are • We are happy to look at “projection available. led” lending and what the company could afford to borrow if it achieved • Online and P2P funders, generally do greater sales/increased EBITDA. not undertake the same level of DD on • If we believe that the management the company/management team that team will achieve the financial we do. projections presented, we generally support. • Some online and P2P funders adopt a • We take a different approach to single approach to the level of PG’s that security, especially the amount of that they require from all directors unsupported PG’s that we ask for. working in the business. • We can process a loan very quickly (subject to existing debenture holders!) 8
What can be funded by the loan? • Working capital/the debtor book • Costs of new people till they are covering their own costs • Stock • Fitting out of new labs/Capex • BD costs • New production lines/New income areas* • Product development • Most things as long as purpose legal! 9
How are the loans structured? • Based on how the cash flow forecast indicates should be the structure. • Capital holiday may be appropriate at the outset (3/6/9 or 12 months). • Monthly or quarterly payments. • Final date for the final payment on any of our loans is Feb 2025. Therefore, around five year maximum at present. • We can incorporate tranches if all the loan is not required at the outset I.E. £300k initially and another £200k within 6 months. 10
What security is required? • We do not have a “one fits all” approach to security. Every transaction is different. • We do however always take a debenture . • We do take unsupported PG’s on a case by case basis. We rarely take “joint & several PG’s”. More likely to be individual and frequently pro-rata to share stake. • We recognise the stake and funds injected by directors working within the business • Unless a broad management team, Key Man life policies can be required. 11
What are the loans going to cost? • All fixed rate (Not over Base Rate). • Between 6-12% Fixed. Interest calculated daily and debited monthly. • Rate based on combination of current company credit rating, latest financials and security. • This year average interest rate circa 7.9 to 8.25% • Arrangement Fee 1.5% 12
Two of the companies we have assisted at Daresbury 13
The FW Team in the room 14
Thank you Simon Berry 07879 691478 simon.berry@fwcapital.co.uk Carol Bolland 07881 958582 Carol.Bolland@fwcapital.co.uk Any questions not already answered? 15
Types of Investment & Attracting Investment Dean Cox Maven Capital Partners
MAVEN CAPITAL OVERVIEW Including £660 million £316m Funds Under Management & Available to Invest Regional fund mandates for £211 million investment in SMEs Invested across five VCTs 87 Nationwide Coverage Investment and Support Professionals London, Birmingham, Manchester, Glasgow, Edinburgh, Aberdeen, Bristol, across the UK Nottingham, Preston, Durham and Newcastle Information as at 31 March 2019 2
MAVEN’S CLIENT FUNDS MAVEN UK REGIONAL BUYOUT FUND MAVEN BUYOUT FUND • Dedicated institutional fund focusing on MBO opportunities across the UK • Sweet spot of between £5m and £15m of equity per transaction INVESTOR PARTNERS • Over 250 high net worth individuals, family offices and fund managers • Typically invest £2- £5m per transaction VENTURE CAPITAL TRUSTS • Five private equity companies listed on the London Stock Exchange • Subject to VCT rules so focused on development capital opportunities REGIONAL DEVELOPMENT FUNDS • Providing equity & debt growth capital funding to SMEs in certain regions 3
NORTHERN POWERHOUSE STATS • Funds invested - £26.5m • Recipients of funds – 42 NPIF investee companies • Job creation – 290 jobs created as a direct result of the NPIF fund • Cheshire and Warrington Region - £5.5m invested. 4
INVESTMENT PROCESS • Maven has a track record with public sector funds of taking SMEs from start up or first equity investment Business plan Introduction to deal through to successful exits. • Maven has the infrastructure in place to ensure swift, effective decision making and to optimise the investment process for businesses and advisers. Legal process & Analysis & Initial • End-to-end process typically between 6 and 10 completion investment committee weeks from time of introduction to completion. • Maven will monitor the performance of each investment through regular management information and face-to-face meetings with the senior Offer letter & due Maven investment diligence management team, providing expertise and committee strategic guidance along the way. 5
Investment Criteria • Management Team • Product • Addressable Market • Commercial Traction • Job Creation • Clear exit strategy 6
Business Plan Overview • Company Overview • Investment Proposal • Market Overview • Financials • Management • Exit Strategy 7
THANK YOU
FOR PROFESSIONAL USE ONLY NOT FOR PUBLIC DISTRIBUTION The content of this presentation does not constitute a financial promotion under the Financial Services and Markets Act 2000 and has not been approved as such by an authorised person. The information contained in the presentation is for exclusive use by professional clients and eligible counterparties and not the general public. The views expressed in this presentation should not be construed as financial advice. Maven Capital Partners UK LLP (Maven) is authorised and regulated by the Financial Conduct Authority. The information is being given only to those persons who have received this document directly from Maven and must not be acted or relied upon by persons receiving a copy of this document other than directly from Maven. No part of this document may be copied or duplicated in any form or by any means or redistributed without the written consent of Maven.
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