The Development Bank of Wales is marking its first full year of operation by announcing an impact of £156m on the Welsh economy during the period.
The development bank, created by the Welsh Government in 2017, was established to fill the funding gap between the finance Welsh businesses need and what the market provides.
One year on from a high profile launch event at The Exchange Hotel, the development bank has invested £72m into 344 businesses, a 24% increase on the last year of its predecessor Finance Wales. This has in turn, attracted £84m in private investment from investors such as Wealth Club, HSBC Ventures and Wesley Clover.
It has been a busy first year for the development bank which has also seen it launch a new business angel network, Angels Invest Wales and Economic Intelligence Wales, a research collaboration with Cardiff Business School and the Office for National Statistics. Last month it completed the move of its headquarters to Wrexham Technology Park adding 18 new members of staff to the North Wales team out of a total headcount increase of 30 across Wales.
Giles Thorley, Chief Executive of the Development Bank of Wales, said:
“The first year of the Development Bank of Wales has demonstrated good progress, making Wales an attractive place for micro to medium businesses to raise the capital they need to get started, strengthen and grow.
“I am particularly proud that as an active equity and technology investor, we have helped Cardiff become an equity hotspot ranked at number 18 in the Small Business Equity Tracker.
“Our priority is to continue to scale up while making sure that we deliver a great service to our customers. We are investing in our digital transformation and recruiting in all regions of Wales, to make sure that we can provide the face to face interaction we know our customers value.”
Economy Secretary Ken Skates, said:
“From establishing its headquarters in Wrexham to launching new initiatives such as Angels Invest Wales, there can be no question that the Development Bank of Wales has achieved a huge amount in its first year, supporting businesses from across Wales to grow and flourish.
“I established the Development Bank because I wanted to make it much easierfor our businesses to have access to the funding they need to start and expand. Working alongside Business Wales and other partners, it has enabled timely advice and funding to be provided simply and effectively and, directly aligned to the principles set out in the Economic Action Plan, I’ve seen first-hand the difference it is making in supporting Welsh businesses of all sizes, strengthening our regional and national economies in the process.
“Congratulations to the Development Bank on a truly prosperous first year and long may its far-reaching successes continue.”
Two of the businesses to benefit from investment are South Wales-based vending machine company, Nutrivend and Homestead Day Nursery in Wrexham.
Nutrivend has been supplying sports nutrition vending machines for gyms, leisure centres and universities from Llanelli to Aberdeen since 2012.
The company, which is based at Llantrisant Business Park in Pontyclun, received a total of £675,000 equity investment from the Development Bank of Wales to help boost growth following a £50,000 micro loan and business angel investment via Angels Invest Wales.
Scott Morgan, Managing Director of Nutrivend, said:
“As an SME, regardless of how good your business concept is, you need funding to be able to grow quickly. The support from the development bank enabled us to implement a national infrastructure with robust systems that we couldn’t have done without their support.
“It has certainly allowed us to become profitable for the last two years andto continue to expand at an unprecedented rate.”
Nutrivend stood at sixth place in the 2017 Wales Fast Growth 50 and is hoping to achieve a higher ranking this year after turnover increased by 433% in the qualifying period. In 2017-18, turnover was £4m and is forecast to be £5.5m in 2018-19, demonstrating just how the investment from the Development Bank of Wales can support growing businesses.
Over the last year, Homestead Nursery in Gresford, near Wrexham has seen the nursery increase capacity by 27%. It now offers Early Entitlement education for pre-school children and has expanded its provision for children over 3 years old by building two log cabins and developing its Forest School site.
Kim Jones, co-owner of Homestead Nursery, said:
“We needed the loan from the Development Bank of Wales as our bank wanted to share part of the funding to reduce their risk. Without it we wouldn’t have been able to purchase the freehold on our business.”