Who says there's no early money...?
Who says there’s no early money…?
On Monday, 27 September, I went to Cambridge for the launch of the Low Carbon Innovation Fund (LCIF). This new fund has been set up by the Low Carbon Innovation Centre at the University of East Anglia with £8 million splashed out by the European Regional Development Fund (ERDF).
What, you thought we never get anything back from Europe…? Actually most of the ERDF’s funds go to so-called “convergence countries” in eastern Europe but some – about € 10.6 billion – has been allocated to Britain for a 7-year period, 2007-2013 inclusive. And some is actually ear-marked for low-carbon initiatives.
The UEA had a prior fund called Carbon Connections with about £3.5 million from the Higher Education Funding Council for England. That was allocated to a range of innovative low-carbon projects and several are doing quite well, including trials of biofuels for heating.
The new fund is a true venture capital fund, to be managed by Turquoise International, which provides “corporate finance for energy and the environment”. Turquoise actually has its own “seed fund” called Turquoise Capital LLP.
The LCIF allocations, which will continue until December 2015, will range from £50,000 to £500,000. If that is not quite enough to get your disruptive technology off the ground, don’t worry: the rules call for Turquoise to raise funds from the private sector on a 40/60 basis. So if you got the full whack, 500 K, from LCIF, Turquoise would have to raise another 750K, giving you a relatively cool £1.25 million.
Given the £8 million as a starting point, Turquoise must raise a total of £12 million from private sources. The money will be raised on a case by case basis.
Ali Naini, MD of Turquoise, said: “We help companies with equity and sometimes debt. Most important, we work to make them ‘investable’” Venture capital is always in short supply so we are excited about this mandate.”
Your blogger meets the Secretary of State
Despite the threatened closure of all of Britain’s regional development authorities, the East of England Development Fund is also involved in administering the regional funds from Europe.
I actually had a chance to challenge Chris Huhne, Secretary of State for Climate Change, on this when he spoke at a Green Alliance event in mid-September. “Who will handle the regional money if the RDAs disappear?” I asked. The Rt Hon stayed calm: “We will have new local enterprise partnerships,” he replied, unkindly adding that the RDAs don’t administer much anyway.
Anyway, despite the RDAs’ possible demise, Andrew Luff, Head of European Structural Fund Programmes at the East of England Development Agency, was quite cheerful at the launch. His job is to manage the overall programme for the region, which includes LCIF as one project.
“When we started to consult back in 2006-07, low-carbon was quite a pioneering theme,” Luff said. “The proposal for the fund was followed by a feasibility study and more discussions with various bodies. We are very happy that, under the LCIF’s rules, low carbon must be at the heart of the proposed activity – and it must produce economic benefits.”
All companies applying must be located in the region or at least have some operations there. Or you can relocate. So my advice for today: anyone wanting a bit of early money should immediately relocate to the East of England. And by the way, the website is: www.lowcarbonfund.co.uk
Posted 01/10/2010 by Elizabeth Block
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