The government has launched a new Enterprise Capital Fund, dubbed Notion Capital, to provide £40 million in funding to high-growth cloud computing and Software-as-a-Service (SaaS) companies.
Enterprise Capital Funds were established to address market weakness by providing equity finance to SMEs, and Notion Capital is the largest fund of this kind to emerge yet. Commitments have been made from private investors, the government and the European Investment Fund.
"It is absolutely vital that ambitious small firms can access the finance they need to expand and grow, and this new Enterprise Capital Fund will provide at least £40 million of funding to viable UK high-tech businesses," said Mark Prisk, business and enterprise Minister.
"Notion Capital [will] help a significant number of firms to grow and create jobs, boosting our economy."
The fund has a pan-European focus, is worth £62.9 million in total and will provide selected SMEs with up to £2 million in equity finance.
"Our strategy is to only invest in what we know (i.e. cloud computing and SaaS) and we think this gives us a strong advantage in the market for both evaluating and supporting companies," said Stephen Chandler, managing partner and co-founder at Notion Capital.
"We aim to identify and support European companies that can become global leaders and generate exits that can be measured in the hundreds of millions."