Collaboration key to environmental sector growth
Greater collaboration between the regional gap-financing community, businesses and enterprise stimulating initiatives is needed to support growth in the region’s environmental sector.
The findings come from a piece of market research into the investment needs and trends for the environmental technology and cleantech sector across Yorkshire and the Humber.
Environmental technologies include waste management, land remediation and end-of-pipe clean-up, while cleantech addresses global environmental challenges, including renewable energy generation and management, resource efficiency and advanced materials.
Yorkshire Forward is the first regional development agency to set a regional carbon reduction commitment, set at 25 per cent of 1990 levels by 2016, and to de-couple economic growth from carbon emission rates.
The transition towards a lower carbon economy is part of Yorkshire’s drive for competition and has identified environmental technology and cleantech, which has a global market of £3trillion, as a priority sector.
The market research assessed the issues and processes facing businesses in being able to access finance and the involvement of intermediaries, who support them in growth, whether sign-posting financial products or providing professional support.
It observed start-up businesses in the cleantech sector typically develop through distinct phases, starting with the ‘proving technology’ stage, when they are likely to access grants and seedcorn support from within the region.
The next stage is centred on ‘proving the market’ and to ultimately attract commercial investment with which to transform the business and take full advantage of market opportunities.
This phase is found to be the most critical and can last for five to ten years, there are many stumbling blocks and specialist sector business expertise is crucial. Ensuring such expertise is available in the region needs to go hand-in hand with provision of the right kinds of finance.
In light of the report’s findings, recommendations included:
- Regional funds and key sector players to collaborate more closely to align their strategies and resources to help draw in more investment to the region
- Further development of packages of resource and assistance to get sector businesses to commercial investor readiness and beyond, and a review of how these could be efficiently provided and afforded within the region
- A review of the need and viability of a highly visible, named and dedicated fund tailored to the sector, which could make larger equity investments (£3m-5m) over longer than usual time periods.
Note: this news article is from Finance Yorkshire’s previous fund. Read more about Finance Yorkshire