There are some fantastic investment opportunities for South East VCs in the Northern Powerhouse.
That is the view of Philip Hargreaves, head of Access to Finance, which helps small businesses in the North West raise money and is part of Business Growth Hub.
In February, the British Business Bank launched its £400m Northern Powerhouse Investment Fund designed to boost small businesses.
And Hargreaves told BusinessCloud his organisation is engaging with investors to encourage them to look north.
However, he added: “Don’t expect as a business owner for funders to come and find you, if you’re looking for investment it’s a long hard job.
“We’re shouting about the North West and the wider Northern Powerhouse cities, because it is a hotbed for tech-related businesses and the message we need to get across to South East investors is that there are some fantastic investment opportunities.”
The founders of used car search website Carsnip attended about 100 meetings in 18 months to raise the funding they needed – $100,000 of which was secured over the phone from a US investor – but not a penny came from London.
Pedro Madeira, head of research at Beauhurst, says that investors prefer London-based tech firms so they can keep an eye on the founders.
However London is not the bed of roses for tech investment that many people think it is, according to the chief executive of the Manchester Tech Trust.
Hampshire-based Morgan Innovation and Technology began investing in medtech companies outside London after encountering funding issues for its own products.
And Leeds-based marketing automation business Force24 resorted to more traditional funding methods after failing to gain funding from VCs with a London bias.