Guest blog: Investment is key

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Availability of investment is key to regional business growth, says SWIG Capital executive director, John Berry

John Berry SmAfter some difficult years it is great to see the nation’s economy recovering. It is now important that the business landscape in Cornwall is well-positioned to continue contributing its share of the growth.

At SWIG Capital, the fund holding arm of the Truro-based South West Investment Group (SWIG), we consider that there are four things that would help improve the economy of our region.

One of these things is within SWIG Capital’s primary area of focus, so first let me cover off the other three.

Firstly, it is vital that Cornwall and the rest of the south west is connected internally and externally through the best possible transport and communication systems. There is more work to do here, although like everyone we were pleased to see the announcement late last year of new investment in our road network. We would encourage all parties involved to ensure that this work is completed swiftly and within budget.

Secondly, we all have a role to play in publicising the success of our local economy and telling the rest of the region, the UK, Europe and beyond what a great place it is to live and work in, and how many established and new businesses are thriving here.

Extolling the virtues of Cornwall as a hub of growing businesses will in turn propagate the third ingredient to our future success, which is the attraction, retention and development of the best people to drive this county’s growth.

And finally, and most crucially from SWIG Capital’s point of view, we want to ensure that investment is available for those businesses which are seeking to grow.

There are many initiatives which aim to support businesses but too many, in my view, miss the mark – judging success by inappropriate measurements, such as the numbers of telephone calls made.

What these initiatives should focus on is making sure the money and resources are placed where they are most effective – in the hands of the businesses themselves.

This is how job creation, innovation, productivity and growth can be best achieved. And this is where interventions around investment in businesses with the most potential should be focused.

So our firm belief at the South West Investment Group is that public sector finance distributed in Cornwall should be directed at businesses which are innovating, growing and setting up here.

By investing loans, equity and mezzanine finance into businesses, they can benefit from access to finance over and above what normal commercial sources such as banks can provide.

In addition, the Cornish economy will also benefit from the resulting growth and the reinvestment of monies returned into future new businesses. This is a virtuous cycle of positivity which could carry on for years.

SWIG Capital holds legacy funds from the South West Investment Group’s previous loans activity which we wish to reinvest into the region over the next few years.

We are also keen to work with the Cornwall and Isles of Scilly LEP, as well as local authorities around the county, to reinvest new funding streams which will come into the region over the coming months.

In particular, we would like to see new funds for the following:

  • Loan finance for growing businesses
  • Equity and mezzanine finance for growing businesses which may be working with crowdfunding initiatives and business angels
  • Early stage innovation finance, working with innovation centres throughout the region
  • Schemes to support brand new businesses, continuing the work which has been done under the Start Up Loans Scheme since it was launched in 2012.

I believe these types of funds, put together, would further enhance the great contribution that Cornwall is already making to our nation’s economic recovery.

We live in a county with massive optimism, promise and potential. It is vital for our future prosperity that businesses are supported in achieving the growth of which they are clearly capable.

About the author: John Berry is an experienced senior economic development professional and has been involved in regeneration and development, and the support and financing of small business since the 1980s. He has served as executive director of SWIG Capital  since April 2009.