Mercia Asset Management – one of the UK’s most active SME investors – has completed investment deals with a total value of over £50m in the North East since opening its Newcastle office four years ago.
During that time Mercia has backed 31 companies in the region and invested over £22.7m from the funds it manages, which in turn has attracted a further £28.6m from other parties including angel investors and private equity firms.
The majority of funding Mercia provided was from the North East Venture Fund (NEVF), which is supported by the European Regional Development Fund, with the remainder coming from its Northern VCTs, EV Growth, EIS and SME Loans funds.
Ian Wilson, who leads the Newcastle office, said: “Mercia aims to identify and nurture rising stars from the region and put the North East on the map as a tech hub. Many of the businesses we back are developing cutting-edge technologies and tackling key challenges such as healthcare or climate change, and some will go on to become global players.
“One of major reasons for our success is the wide range of funds we can offer, which means we can provide early-stage investment and then follow up with further funding to help them scale and grow. We also offer practical support and help them build their boards by matching them with experienced entrepreneurs from their industry who have done it all before.”
Success stories include Notify Technology of Newcastle, which aims to save lives by helping companies log accidents and improve health and safety at work and has users in over 100 countries. Mercia has backed the company since its inception in 2017 and it recently raised over £3m in a funding round led by London-based Calculus Capital. Others include Newcells Biotech which helps derisk the process of drug development and Troo which enables SME businesses to drive down their energy costs.
Mercia has also achieved three exits during the period. It sold Newcastle-based Refract Software to the US company Allego, while Cramlington’s Avid Technology was acquired by Turntide Technologies, which is backed by Bill Gates and Consett-based Elmtronics Group was acquired by Europe’s largest renewable energy producer Statkraft.
Ian Wilson adds: “Some of the businesses we have supported since opening the Newcastle office are already selling worldwide and attracting investment from outside the region, which in turn will support their further growth. By seeking out and nurturing promising businesses, we are helping to build the industries of the future.”