BBB commits £6.6bn to fuel innovation and drive growth

The British Business Bank has unveiled a £6.6 billion commitment aimed at accelerating innovation, driving growth, and unlocking the potential of UK entrepreneurs across all regions and backgrounds. The move, announced today by the Secretary of State for the Department for Business and Trade, represents a significant expansion in support for smaller businesses and aligns with the government’s modern Industrial Strategy.

Central to the announcement is the creation of the British Business Bank Industrial Strategy Growth Capital, a new £4 billion initiative that will invest in eight high-growth sectors: advanced manufacturing, clean energy, creative industries, defence, digital and tech, financial services, life sciences, and professional and business services. The initiative is expected to attract an estimated £12 billion in private sector co-investment, delivering £16 billion in total capital to the UK’s most innovative companies over the next four years.

Another £2.6 billion will be allocated to help entrepreneurs, regardless of background or geography, access the capital they need to scale their ventures. This includes targeted support for regional innovation clusters and underrepresented groups.

Louis Taylor, CEO of the British Business Bank, said: “We welcome today’s announcement… Using our market expertise and reach, we have a critical role to play in supporting smaller businesses in the eight growth-driving sectors to grow and stay in the UK.”

The announcement follows the Spending Review’s decision to boost the British Business Bank’s total financial capacity to £25.6 billion, enabling a two-thirds increase in annual investments to around £2.5 billion. Reforms to the Bank’s governance and financial structure will ensure this increased activity is sustainable, including a permanent capital base with greater flexibility for reinvestment.

The £4 billion Industrial Strategy Growth Capital programme will offer:

Strategic investments of up to £60 million in innovative UK companies.
Cornerstone funding for specialist venture capital funds and emerging fund managers.
Tailored financial products such as early-stage investments in high-potential sectors like AI and sector-specific debt funds to support supply chains.

These measures are projected to contribute £30 billion in additional Gross Value Add (GVA) to the UK economy over the investment lifecycle.

A core component of the new investment is dedicated to bridging regional finance gaps, ensuring entrepreneurs outside London and the South East have access to growth capital:

Two new Nations and Regions Investment Funds worth £350 million will launch in the East and South East of England.
A further £100 million will reinforce existing regional funds and support ten high-growth clusters in cities such as Manchester, Glasgow, Cardiff, and Belfast.
Dedicated Cluster Champions will be deployed to build local financial ecosystems and connect firms with investors.
The Regional Angels Programme will expand to support early-stage equity investment in underserved regions.

To ensure a more inclusive entrepreneurial ecosystem, several initiatives are being launched:

Angel Syndicate Support and Embracing Diversity programmes to grow diverse angel investor networks.
A new Investor Pathway Capital programme to support diverse and first-time fund managers breaking into venture capital.

Further measures to support UK small businesses will be detailed next month as part of the government’s Small Business Strategy.