Ryan Bevington, Partner at Maven Capital Partners and Fund Manager of NPIF Maven Equity Finance
Ryan Bevington, Partner at Maven Capital Partners and Fund Manager of NPIF Maven Equity Finance, which is part of the Northern Powerhouse Investment Fund (NPIF), discusses the outlook for North West businesses and prospective investors.
Has Covid-19 continued to impact the North West investment market in 2022?
Covid-19 continues to underline the importance of SME funders such as Maven to the investment ecosystem, both in the North West and the UK as a whole. Private equity has an even more critical role than usual in fuelling economic recovery because banks alone simply do not have the dry powder to meet demand for funding, and private equity firms are often able to provide wider support beyond purely finance.
This is not necessarily an ill omen for the business community; many of those companies driving demand for support are SMEs born of the pandemic that now need funding and critical strategic input to build on their early success. Facilitating accessible funding for these companies will be key to sustaining the long-term vitality of the regional (and national) business ecosystem.
What key growth areas should we be keeping an eye out for over the next twelve months?
The cost of living crisis will exert a considerable impact on both businesses and consumers in the coming months. However, in the longer term, we expect sustainability to remain on top of the business agenda as the drive to achieve Net Zero by 2050 continues apace.
This trend will be seen across a wide range of sectors. Accordingly, Maven has this year invested in companies as diverse as Cryoniss (life sciences), Pura (baby care) and Intelligent Building Group (proptech), all of which will use part of their funding to realise their sustainability goals.
Similarly, sustainability concerns are now understandably embedded in the thoughts of many investors. This means businesses seeking investment must demonstrate that these concerns are central to their own business models and growth strategies.
In addition, “tech” has been the word on everyone’s lips when discussing the areas that have enjoyed particularly robust growth since the start of the pandemic, and it goes without saying that many of the most resilient businesses in the last two years have placed a strong emphasis on tech.
But tech is not a specific sector so much as an aspect of almost every promising business in the SME ecosystem. Pura, Cryoniss, and IBS, for instance, all leverage some of the most cutting-edge technology in their respective arenas, regardless of whether that is baby care or the more overtly “techy” proptech and life sciences sectors. Judicious and innovative use of tech to fill a gap in the market is therefore just part of an overall profile that will make a business attractive to investors.
Do you expect NPIF Maven Equity Finance to sustain its high deal volume over the next year?
We intend to continue providing the support that North West businesses need as we hopefully emerge with more optimism and opportunities from the pandemic. We have already invested in five companies since the turn of the year, and we invested more than £17m overall in the twelve months before that. Sustaining this momentum over the next year is certainly an ambitious target, but given the local expertise of our investment managers and the rich community of high-potential growth businesses in the region, we are confident that we can achieve such a goal.
What will Maven’s focus be for the second half of 2022?
Our focus for the rest of the year will be on sustaining support for our portfolio companies and balancing this with new investment in innovative SMEs across the region. Our advisors are active in areas from Cumbria to Cheshire, are extremely familiar with their local business landscapes, and can therefore identify the best opportunities for North West businesses seeking funding for the next stage of their growth.
How do you expect the North West investment market to develop compared to other regions?
The North West is the most established region, outside London, for investment in growth businesses. Indeed, Tech Track 100 named it as the region with the most fast-growth tech company bases outside the capital. Manchester in particular is renowned as a hub of innovation, with the UK’s fourth largest digital economy in terms of turnover, and the highest outside London and the Thames Valley.
This breeding ground for innovative early-stage businesses is supported by a robust culture of investment. Since launching in 2017, the NPIF has directly invested more than £300m into almost a thousand North West businesses, alongside £400m of private sector co-investment. Earlier this year, the British Business Bank, which delivers the NPIF, forecast a record year for equity investment in the North West in 2022, and we believe that this prediction will be proven correct by the end of the year.
What do you hope to achieve by this time next year?
We hope we can look back on twelve months of economic recovery and draw a line under the pandemic. Whilst the pandemic created a challenging operating environment for many businesses and sectors, it also provided many businesses with an online business model or disruptive technology with an opportunity to continue making commercial traction and to deliver growth in recurring revenues. Private equity backed companies will play an important role in the restoration of economic growth across the UK, and Funds such as NPIF Maven Equity Finance are likely to make a telling contribution to this within the North West.
