PKF Francis Clark is hosting a seminar which brings together providers of business funding, including both debt and equity; business support agencies including grant specialists; our own corporate finance experts and business owners themselves to provide short, sharp presentations in order to assist business owners and managers in assessing which funding stream is right for them.

1. Finance in the South West
Paul Butler, Partner 22 February 2017

2. pkf-francisclark.co.uk
It’s been described as ‘speed dating with funders.’
Owners looking to expand their business – or people planning to start their own venture – are invited to the fifth annual Finance in
the South West seminar.
Organised by chartered accountants and business advisers PKF Francis Clark, more than a dozen sources of grant, debt and
equity funding as well as business support agencies will be taking part.
Places still available for ‘speed
dating with funders’ event

3. pkf-francisclark.co.uk
Administration

4. pkf-francisclark.co.uk
• Follow us on twitter @pkfFrancisClark
• Tweet about this event using #FCFinanceSW
Twitter

5. pkf-francisclark.co.uk
PKF Francis Clark
PKF Francis Clark offices

6. pkf-francisclark.co.uk
Presentations
And more… (24 presentations in total, covering “full range” of funding and business support options)

7. pkf-francisclark.co.uk
Warning mechanisms
One minute to go

8. pkf-francisclark.co.uk
Structure of morning
• Background, Equity, Debt and Business Support (8.30am to 10am)
• Heart of SW LEP
• Banks: an overview
• Equity and Grants
• Growth Hub
• Coffee Break (10am to 10.25am)
• Funding, Business Support, Investment Ready and SME
perspective (10.25am to 12noon)
• Start Up (trading for < 2 years)
• or Established Business
• Lunch and Networking (12noon to 1pm)

9. Chris Garcia,
Chief Executive
Update from the
Local Enterprise
Partnership

10. The Heart of the South West LEP
Repositioning the Heart of the South West’s profile and
reputation, nationally and globally. Connecting people,
places, businesses and ideas to transform our economy,
securing investment in infrastructure and skills to create
more jobs and enable rewarding careers.

11. Your LEP - one of 38
What the LEP is not:
An agency of Government like RDA, designed as a delivery arm of
central government, nor are we simply a funding body.
What the LEP is:
A local platform for collaboration across public and private sectors, to
achieve mutual economic aims and we
• Identify common priorities
• Attract resources & investment
• Make a difference to prosperity
Examples of what we support:
• Funding bids to national Government e.g. Growth Deal
• Influencing national Government strategy e.g. road and rail
• Strategic partnerships e.g. with neighboring LEPs

12. Progress since our AGM in
October
Growth Hub progressing
Partnering & influencing
Delivering £485m portfolio
• 47 projects
• 172m Growth Deal 1&2
funding
• £22.5m Growing Places
Fund
Influencing delivery of
European Structural Funds
Securing Investment Managing & delivering
Environment
Rural Growth Network
Awaiting Growth Deal 3
Focus: achieving best
practice transparency &
governance
Government’s Cities and Local
Government team highlighted
HotSW were ‘ transparent and
informative beyond our remit’
New Nuclear
Devolution
Road & rail improvements
Enterprise Zones
Broadband
Housing
Careers

13. Brexit?
There’s a lot going on
Productivity
Plan?
Industrial
Strategy? Devolution?
1. Growing productivity / prosperity
2. Competing for the resources to do this
Same
outcomes!
Attracting
investment

14. Who’s talking about a Great South West:

15. Who’s talking about a Great South West:
A brand
supported by
business (building
on the SW
Growth Charter)
A brand across
higher skills and
innovation
providers
A brand
supported by
Local Authorities
and LEPs

16. THANK YOU &
www.heartofswlep.co.uk
Please register for our monthly Newsletter &
twitter at
www.heartofswlep.co.uk/newsletters
@HeartofSWLEP

17. Banks - an overview
Geoff Harding, Deputy Agent, South West Agency
Exeter, 22nd February 2017

18. Outline
Resilience of the financial system
Credit conditions
Hurdle rates and interest rates

20. Results of the 2016 stress test
2016 stress test incorporated:
• a synchronised UK and global
recession;
• shocks to financial market prices;
and
• a stress of misconduct costs.
 More severe than stress tests
ran in 2014 and 2015.
 ‘Hurdle’ was tougher,
particularly for systemically
important banks.
Peak-to-trough falls in nominal house prices in
Bank of England stress-test scenarios and
previous UK recessions(a)

21. UK banks have built their capital resilience over
time
Sources: PRA regulatory returns, published accounts and Bank
calculations.
Major UK banks’ capital ratios
13.5% RWA at
Sept 2016,
compared with
internationally
-agreed 4.5%

22. Some major UK banks continue to face the challenge of
weak profitability
Reflects:
• Costs related to past
misconduct
• Weak profitability of UK
banks’ investment
banking businesses as
certain business lines
have shrunk materially.
Persistently weak profitability
diminishes banks’ future ability to
rebuild capital following a shock.
UK banks’ profitability remains low

23. UK bank funding spreads have fallen slightly
Sources: Bank of England, Bloomberg, IHS Markit and Bank calculations.

24. The recent pickup in some measures of uncertainty
was not accompanied by a sustained tightening in
credit conditions
Sources: Bloomberg, Consensus Economics, Dow Jones Factiva, GfK (research on behalf
of the European Commission), Thomson Reuters Datastream and Bank calculations

25. Lending growth has risen in recent years

26. Agents’ assessment of corporate credit availability(a)
From Agents’ Summary of Business Conditions 2016Q4

27. Corporate credit availability(a)(b)

28. Perceived availability and cost of credit for large
and small firms
Sources: Deloitte CFO Survey, FSB Voice of Small Business Index, Bank calculations.

29. Obstacles to investment over the past five years(a)
Source: Bank of England Finance and Investment Decisions survey.

30. Rates of return on capital and cost of capital compared
to survey measures
Source: Bank of England, ONS Profitability of UK companies and Bank of
England Finance and Investment Decisions Survey.

31. Long-term interest rates have risen globally
Sources: Bloomberg and Bank calculations.

32. Market-implied paths for short-term interest rates have
risen internationally
Sources: Bank of England, Bloomberg, European Central Bank (ECB) and Federal Reserve.

33. Banks - an overview
Geoff Harding, Deputy Agent, South West Agency
Exeter, 22nd February 2017

34. James
Baughan

35. 01

36. 02

37. 03

38. 04

39. #

40. #

41. #

43. #

45. #

46. #

47. #

48. #

49. #

50. #

51. #

52. #

53. #

54. RICHARDECKLEY
SeniorInvestmentAnalyst
EquityCrowdfunding

55. The Power
of the
Crowd

56. ANGELS

57. CROWD

59. WHY CROWDFUND?
 Global Investor Reach
 Cost effective
 Marketing effect
 Crowd feedback
 Expertise
 Fair Terms
 Financial return
 ‘Armchair Dragon’
 Support friends and family
 Access exciting investments
 Lower/spread risk
 Simple to invest

63. Under 25
25-34
35-44
45-54
55-64
65 or over
DIVERSE COMMUNITY
Gender split
• 74% male, 26% female
• 3% of angel network members are female
• 4% of VC partners are female
• 9% of AngelList members are female

64. £70,000
Annual salary
42%
Investment from high net worth &
sophisticated investors
 Technology
 Marketing
 Financial Services
 Management
Consulting
 VC and Private
Equity
TOP JOBS TOP 5
£
£
£
investor employers

65. DEMOCRATISATION OF INVESTORS

66. The Evolution of Success

67. The Evolution of Success

68. The Evolution of Success

69. 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2011 2012 2013 2014 2015
Percentage of Seed deals
crowdfunded*
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2011 2012 2013 2014 2015
Percentage of Venture
deals crowdfunded*

70. £212 MILLION +Successfully raised
£0
£10,000,000
£20,000,000
£30,000,000
£40,000,000
£50,000,000
£60,000,000
£70,000,000
2011 2012 2013 2014 2015

71. 0
20
40
60
80
100
120
140
2011 2012 2013 2014 2015
483
Successful raises

72. £28,829,372
£66,096,144
£88,845,206
Stage of Growth
Start up Early stage Growth
41%
35%
24%

73. £1,000,000
Largest single investment
£
£10,000,000
Biggest deal
£440,242
Average deal
£1,789
Average investment
52%
Pitch success rate
£4,387,087
Average amount invested per month

74. 348,000+Investor community
0
20,000
40,000
60,000
80,000
100,000
120,000
2011 2012 2013 2014 2015

75. WHAT NEXT

76. THANK YOU
Richard Eckley Senior Investment Analyst
@re_crowdcube
www.crowdcube.com
@crowdcube

77. Angel Network: MyVAN
Rob Misslebrook

78. Introduction
• Mylor Ventures Angel Network (MyVAN)
– Business Angels with a SW focus, members of the
UKBAA
– Active Experienced investors with added value:
• Networks and sales connections
• Technical
• Bring their own disciplines
– Invest their own cash
– Will often take a board or NED position

79. An integrated Approach
• Mylor Ventures Angel Network (MyVAN)
and/or….
Your own cash
Family and Friends
Crowd (Crowdcube, Seedrs, Funding Circle)
and/or….
Grants
[VCs – EBITDA>£0.5m]

80. What Angels Look For:
• Businesses with
– Strong Value propositions
– Large markets
– Intellectual Property
– Credible Management
• Capital Efficient
• Gross margin must cover HR
• EIS/SEIS
• Willingness to let Angels participate
• [NED Register]

81. MyVAN ref Crowd & Grants
• Crowd (Fixed timeline)
– Pump priming (MyVAN)
– Detailed preparation
– Alongside corporate/VC/PE
• Grants (Non dilutive)
– When available
– Reduce overall risk

82. What Angels Look for - Preparation
• Investment Readiness Toolkit
– Templates
• IMs, Models, Presentations
– Documents
• NDAs, Contracts, SH Agreements
– Policies
• Procurement, Ethical, Environmental
• Its always a buyers market but good companies
well prepared always get funded

83. Process - Delivery
• MyVAN
– Apply at www.mylorventures.co.uk/angel-network/
– Investment Readiness (1 – 2 months)
– Summary Document– ‘yes/no’
– Meetings/Skype
– Agreement/Participation
– Execution
• Crowd – note timeline benefits
• Grants – non dilutive but ensure focus is maintained

84. rob@mylorventures.co.uk
07760 282106

85. Grants - overview
David Armstrong

86. pkf-francisclark.co.uk
.
What follows

87. pkf-francisclark.co.uk
.
European Programme 2014 - 2020
• Funding aligned to the European Structural &
Investment Funds Strategy
• Brexit?
• Administered via around “calls”
• Revolving door
• http://www.heartofswlep.co.uk/news/european-
structural-and-investment-funds-strategy

88. pkf-francisclark.co.uk
.
Rural businesses
• Good news!
• Size, location, activity..
Definition

89. pkf-francisclark.co.uk
.
RDPE Growth Programme
• £12.4m - rural jobs, increasing growth and
productivity
• Three themes:
1. Business Development (including Farm Diversification).
2. Food Processing (includes drinks).
3. Rural Tourism Infrastructure
• Separate presentation

90. pkf-francisclark.co.uk
.
LEADER
• Local Action Groups (LAGs)
• Rural businesses, communities, farmers, foresters and
land managers.
• Cross over with RDPE eg farm diversification, rural
tourism BUT at lower thresholds
• https://www.gov.uk/guidance/rural-development-
programme-for-england-leader-funding
• Devon Renaissance

91. pkf-francisclark.co.uk
.
European Maritime Fisheries Fund
• Investment in fishing vessels, portside infrastructure
and aquaculture
• Sustainability, health & safety, innovation and adding
value rather than capacity
• 50% grant rate
• Projects to 2018 – dependent upon Brexit
• https://www.gov.uk/guidance/european-maritime-and-
fisheries-fund-emff-before-you-apply

92. pkf-francisclark.co.uk
.
The Carbon Trust Green Business Fund
• Greener businesses
• Energy surveys and workshops
• Procurement support - energy efficient lighting, heating
or refrigeration equipment
• Grant of £10,000
• Until 2019 OR when funds run out
• https://www.carbontrust.com/client-
services/programmes/green-business-fund/

93. pkf-francisclark.co.uk
.
SWMAS – Local Manufacturing Advisory Programme
• Range of tailored business support
• Capital grant of £2,000
• https://www.swmas.co.uk/business-support/local-
manufacturing-advisory-programme

94. pkf-francisclark.co.uk
.
Innovation / R&D
Innovate UK:
• Sector specific and open rounds
• www.gov.uk/government/organisations/innovate-uk
Horizon 2020 – SME Scheme:
• Similar to the Old SMART scheme
• http://ec.europa.eu/easme/en/sme-instrument-
factsheets
R&D Tax Credits

95. pkf-francisclark.co.uk
.
Keeping up to date
www.francisclark.co.uk/services/corporate-finance/grant-
advisory/

96. one agency
Rural Development Programme for
England - The Growth Programme
Grant Funding Opportunities
Angela Quinn, Area Manager
Rural Payments Agency
96

97. PROTECT one agency
Purpose
• Grant funding available for rural businesses
• Application process and timescales
• Further information and support
97

98. PROTECT one agency
Background
• RDPE Growth Programme provides funding for Projects in England which
creates jobs and growth in the rural economy.
• The Government has confirmed that it will guarantee funding for RDPE
Growth Programme grants if these are agreed and signed before the UK’s
departure from the EU subject to 2 conditions (1) VFM (2) Priorities
• £120 million is now available through three new national calls for projects.
The calls have been developed in collaboration with Local Enterprise
Partnerships (LEPs) and will be open to support:
 Business development
 Food processing
 Rural tourism infrastructure.
• Of that £120 million, over £12 million is available for rural businesses whose
projects are located in the Heart of the South West Local Enterprise
Partnership (LEP) area.
98

99. PROTECT one agency
Business Development Grants £2,784,740
Who can apply?
• Micro & Small rural businesses (and farmers who are diversify into non-
agricultural activity) are eligible to apply, and your project must be in a rural
area of the LEP.
What are the grants for?
• To help rural businesses grow and create more jobs.
• Grant funding can help pay for (list of ineligible costs will be available in the
handbook):
 constructing or improving buildings
 buying new equipment and machinery
How much money can you apply for?
• Grants can cover up to 40% of eligible costs of a project. The minimum
grant for the Heart of the South West LEP is £35,000 (minimum project size
of £87,500) with State aid rules limit funding to €200,000, around £170,000
99

100. PROTECT one agency
Food Processing Grants £7,540,000
Who can apply?
• Any size Food and drink business can apply that processes agricultural and
horticultural products in rural or urban areas e.g. meat, milk, grain and root
vegetables.
What are the grants for?
• To help businesses grow and create new jobs.
• Grant funding can help pay for (list of ineligible costs will be available in the
handbook):
 constructing or improving buildings
 buying new equipment and machinery
How much money can you apply for?
• A minimum of £35,000
• Intervention dependent on nature of activity, for example primary agricultural
production (annex 1) in and out of process could be eligible for up to 40%.
100

101. PROTECT one agency
Tourism Infrastructure Grants £2,088,555
Who can apply?
• If the project is commercial and will make a profit, only small businesses and
farmers who want to diversify can apply.
• If the project won’t make a profit, a wide range of organisations can apply
(including public bodies and charities).
What are the grants for?
• The grants will help fund the costs of capital expenditure on tourism
infrastructure. The aim is to support projects that will encourage more
tourists to come, to stay longer and to spend more money in rural areas.
How much money can you apply for?
• £35,000 minimum grant amount
• Maximum grant rate for commercial projects will be 40%. Higher levels of
support available for semi-commercial (80%) and not-for-profit (100%)
activity.
101

102. PROTECT one agency 102

103. PROTECT one agency
Top Tips
• Jobs & Growth – whole purpose of the Growth programme is to create jobs and
economic growth across rural areas, so tell us how your project will do this.
• Sell us your idea – explain clearly what your project does and how it will benefit the
economy. It is a competitive process.
• Don’t ask for full amount if you don’t need it – we will assess your application on a
competitive basis ensuring it represents value for money for the public purse. You
should only apply for the amount you need to for the project to proceed.
• Show us what the grant funding means to your project – why is it critical you
receive public money to enable it to happen.
• Do the market research – you have to be able to evidence that there is a real need/
demand for what you want to do.
103

104. PROTECT one agency
Further info
All information including EOI application is available on the www.gov.uk
website input ‘Growth Programme’ or simply input ‘Growth Programme’ into
Google search.
There is a handbook available for each of the 3 calls. Handbook includes:
• who can apply
• how and when to apply
• which specific activities you can claim for (and which you can’t)
• what grants are available in your area
• Please also contact the RPA if you would like to discuss your project/ would
like any further advice: Rural Payments helpline : 03000 200 301 and/or
Email: GPEnquiries@rpa.gsi.gov.uk
Key Dates to Note:
• EOI in by 31st January 2018
• All projects must be delivered and claimed by December 2019
104

105. David Hynd, Programme and Partnership Manager
www.heartofswgrowthhub.co.uk
Finance in the SW 2017

106. What is a ‘Growth Hub’ & Why?
• Growth Hubs are established within each Local
Enterprise Partnership (LEP) area to address a policy
drive for better connection between local and national
business support and a simplified landscape.
• Heart of the South West Growth Hub is the first point of
call for accessing local, regional and national business
support initiatives.
• Delivered by our small team of Business Advisers
supported by extensive knowledge resources and our
dedicated website.
Key Facts
Free service for any business based in Devon, Plymouth, Somerset or Torbay
To engage 4,200 businesses and introduce 840 businesses to funded support schemes
Heart of the South West LEP’s main mechanism for engaging with businesses across the area

107. The Productivity Challenge
 Poor comparative skill levels
 Labour market shortages
 Insufficient infrastructure and poor connectivity
 A lack of joined-up support for business
 Need for higher value industrial densities.
Productivity is c80% of UK average
(based on GVA per job filled, 2013)

108. Business support confusion

109. Heart of the SW Growth Hub
A single point of access for businesses support
Introduce you to grants, advice, events
Extensive knowledge resources and a dedicated website
Growth Hub is…
• Free, impartial business enquiry service
• Advisers on hand to talk to you
• Workshops with delivery partners
• Factsheets on business topics
• Dedicated business support website

110. Heart of the SW Growth Hub
A few headline statistics…
Top sectors engaging
o Manufacturing 18%
o Professional services 16%
o Wholesale & retail 10%
87% are established businesses
13% are pre-starts
98%+ of businesses engaged are SMEs
41% are sole traders
85% of businesses engaged have <10 employees (includes sole traders)
Trends in business support schemes

111. Heart of the SW Growth Hub
Over 1,600 business engaged since our launch in March 2016
We have introduced 300+ businesses to specific schemes to meet their needs
Our website shows all business schemes & lists free or subsidised events
96% of respondents gave a rating of Very likely or Likely to recommend
Growth Hub is…
• Making referrals to over 40
business support schemes
• Signposting to over 190 sources
of support and guidance

112. Partner Briefing Pack
Partnership Working
For Stakeholders & Scheme Providers
 Partner Section on the Growth Hub website
http://www.heartofswgrowthhub.co.uk/partners/
 Monthly Growth Hub Briefings
For Scheme Providers
 Complete a Business Support Provider registration form
 Tell us about services, workshops & events
For Commercial Providers – Free, Supplier Database
 Free directory of local businesses that offer advice, support and B2B services
 http://www.heartofswgrowthhub.co.uk/supplier-database/

113. Support & Grants to Grow My Business
New Schemes to look out for… coming soon
 ERDF Brokerage Service - face to face advice & Action Plan
- Growth Programme (modules for specific advice)
 ERDF Social Enterprise Support - tailored support for social enterprises
 ERDF Start-Up Support – workshops, advice and support for start-up businesses
(Actual scheme names & details to be confirmed)
Defra Growth Programme – RDPE Grants
• Grants funded by the European Agricultural Fund for Rural Development
(EAFRD).
• For (1)Rural Business Development (2)Tourism Infrastructure (3)Food Processing
• Grants of up to 40% of project cost
• Primarily for capital expenditure (e.g. equipment)

114. Success Story – Sweet Cumin
Adviser Laura Daniel worked to understand the business needs
1 to 1 business advice provided via our Growth Support Service
Introduced to Local manufacturing Advisory Programme
“It’s easy to get overwhelmed by all the business advice and support out there. The Growth
Hub offers free support, and because it’s impartial it can help me concentrate on the right
support for me and my business.”
Bini Ludlow – Sweet Cumin
• Cookery school teaching Indian and traditional
Gujarati cooking
• Diversified into frozen prepared meals
• Contacted us for help to expand the business
nationally

115. Get In Touch, Stay Updated
 Telephone 03456 047 047
 Email info@heartofswgrowthhub.co.uk
 Website www.heartofswgrowthhub.co.uk
David.Hynd@heartofswgrowthhub.co.uk

116. Finance in the South West
Paul Butler, Partner 22 February 2017

117. pkf-francisclark.co.uk
Overview
- Always appear to be debt and equity financing
options available
- Grant funding is often a possibility that is
overlooked
- Discuss future plans with your advisors

118. pkf-francisclark.co.uk
Overview
“Finance and support for your business”
• https://www.gov.uk/business-finance-support-finder
• ICAEW identified 362 lending institutions in the UK
• Opportunities
• Mainstream banks
• Debt alternatives
• Equity sources
• Grant funding
• Tax reliefs

119. Break (25 mins)
Best Mate Suite
Session 2 start time 10.25am
• Iddesleigh Gallery - Upstairs
(< 2 years trading)
• Denman Suite
(Established businesses)

120. (c) copyright PKF Francis Clark, 2017
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