Early stage investment incites growth within Yorkshire businesses

Some of the region’ most successful companies first found growth with an early stage investment from Finance Yorkshire.

The Seedcorn Fund provides investment of up to £780k in businesses that are developing new technology-based solutions, which have the potential to disrupt their chosen markets.

Two companies to have developed with Seedcorn funding from Finance Yorkshire were recently listed on the Alternative Investment Market (AIM) having grown their market values considerably.

Sheffield-based Xeros Technology Group plc, which is behind a new bead-based cleaning technology that results in significant savings on water, energy and detergent while at the same time delivering improved cleaning results.

Finance Yorkshire made three investments in Xeros totalling £1.45m. The company, led by CEO Bill Westwater, floated with a market capitalisation of £80m and has more than doubled its share price to 260p.

Starting with just three members of staff in 2009, Xeros now has more than 70 employees across the UK, US and China.

The company also recently announced a deal with German specialty chemicals business LANXESS, which will see its technology applied to the leather processing industry.

OptiBiotix Health plc, based in York, listed on AIM when its market value was £6m, and in just 12 months that has risen to over £27m. Finance Yorkshire invested £520k, helping to create the life sciences business from an idea to develop products to tackle obesity, high cholesterol and diabetes.

Julian Viggars, investment director of Seedcorn Fund, said: “Our portfolio includes some of the most exciting science and technology based businesses in the UK. Investing in these businesses requires specialist knowledge and a long term approach as value is not created overnight.

“We have nurtured Xeros and OptiBiotix from the very start and continue to support them. A listing was once seen as providing an exit for venture capitalists but we are successfully using the public markets to provide businesses with additional investment capital to continue their long term growth.

“As Xeros and OptiBiotix have experienced, a listing is also very effective in raising a company’s profile to both a national and global audience and to attract the very best management talent.”

Finance Yorkshire provides seedcorn, loan and equity linked investments, ranging from £15k to £2m to help a range of small and medium sized businesses to meet their funding requirements for growth and development.