Breakthrough - supporting fast-growth UK business by Santander Breakthrough programme on 02-Dec-2011

A new programme to support the best and fastest growing businesses in the UK and help them fulfil their growth ambitions, create local jobs and drive economic growth is being launched by Santander.

Through the Breakthrough programme, up to £200 million of growth capital is being made available to fast-growth companies looking to invest in and grow their business. The loans are available to businesses with an annual turnover of up to £10 million which have a demonstrated history of high year-on-year growth in turnover, profit or employment.

"I welcome the Breakthrough fund and the work Santander is doing to recognise the potential of up-and-coming small businesses and giving them the extra boost they need," said Mark Prisk, Business Minister. "The government is striving to do all it can to create the right environment for firms to thrive and to rebalance the economy. We are reducing the regulatory burden on businesses, slashing the main rate of corporation tax for small firms to 20% to help make the UK the best place to do business, and supporting Regional Growth Fund projects with small businesses at their heart. These are all steps in the right direction."

The loans have been designed to help address a recognised gap in the funding market for companies of this size and can be used to fund growth initiatives such as introducing new products, expanding overseas or recruiting new staff. Breakthrough’s growth capital loans can be used as an alternative to equity investment where business owners don’t want to relinquish a large proportion of the business they have built up in exchange for capital.

The £200 million of growth capital includes a £50 million contribution from the Government’s Regional Growth Fund to help leverage loans at the smaller end of the investment range and in more economically-challenged areas (excluding London and the South East).

Fast growth businesses have a major impact on the UK economy. According to Experian data, there are 9632 fast growth, or Growth Champion, businesses with a turnover of up to £10 million in the UK. Between them they employ 404,849 people and have a combined net worth of around £9.2 billion.

Alongside finance, Breakthrough is also offering businesses access to a range of support and development programmes, not usually available to companies of this size. These include fully-funded overseas trade missions; fully funded internships; opportunities to learn first-hand from experienced fast growth companies such as Google and LoveFilm; networking events and training courses.

"Small and medium-sized businesses are vital to the UK economy and it is crucial that they are able to access the finance they need to invest in their businesses, to grow and create jobs and stimulate demand throughout the supply chain," said Steve Pateman, Executive Director of Corporate, Commercial and Business Banking.

"We know that there is a recognised funding gap for companies with a turnover of under £10 million looking for growth capital and we want to help fill that gap. This is part of the role that banks can play in supporting a private-sector led recovery and stimulating local economic growth."

"It's not just money that drives business growth – but the people behind the business. We know from our own experience how challenging growing a business can be and that is why we are providing a comprehensive package of support to assist British business owners in the steps they are taking to invest in and grow their business."

The programme will be delivered regionally with the support of regional boards. These boards will harness local knowledge to ensure the support available to companies is tailored to meet the needs of companies within the region.

The Breakthrough programme and £200 million growth capital is in addition to Santander UK’s existing support to British businesses, including its pledge to lend £4 billion to SMEs in 2011, as part of the Merlin agreement with the Government. Santander is ahead of these commitments with lending to SMEs reaching £3.19 billion in the third quarter.

Case Study - Muubaa

London-based Muubaa is a leather fashion retailer that already exports to more than 20 countries worldwide. Chief Executive, Stephen Sacks, took part in a Breakthrough trade mission to Brazil where he was able to meet with potential partners, suppliers and customers.

"I think the Breakthrough programme is the most innovative idea which I’ve seen a bank come up with in many years," said Stephen.

"It was an enormously positive trip. I appointed a showroom and we got stock out there immediately. We started a sales campaign a week-and-a-half ago and we already have nine retail customers in Brazil as a direct result of that."

For further information on the Breakthrough programme, please visit: www.santanderbreakthrough.co.uk

For further information abuot Mubaa: www.muubaa.co.uk

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