Venture chief Norman Whyte attacks banks over funding (From York Press)

Venture chief Norman Whyte attacks banks over funding

9:40am Tuesday 9th February 2010 in

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MORE than a year on since the Whyte Knight fund was launched to help new and early stage ventures in York – and the take-up is “not as we would have expected”.

That is the verdict of Norman Whyte, after whom the fund is named, who has openly criticised the banks for not playing their part.

The problem is the loan had to be matched pound-for-pound between the venturer and the fund.

But too often when applicants turned to the banks, help there came none.

Available to new businesses is £200,000 in cash, made up by contributions from City of York Council (£50,000); Aviva (£50,000) and York Business Development (£100,000).

On top of this are subsidised services to the tune of £100,000 offered by members of York Professionals.

Mr Whyte said: “The principle was simple. A small venture may have a proposition which will require finance of say £10,000. The Whyte Knight fund would be more than happy to offer half of that, with the applicant providing the other half from whatever source possible.

“The problem has been that those who have applied have been turned down by the banks for matched funding.”

Perhaps, he said, they preferred to batten down the hatches and concentrate on existing customers, guided also by the fact that there was often no security available to support these loans.

Even so there have been six applications processed, with the fund approving a total of £40,000 in loans .

Mr Whyte said: “It is a condition of the loan that they enter a mentoring agreement, so that we are holding their hands at an early stage, referring them to all the appropriate support agencies and business professionals they might need.

“In other words, we are keeping a careful eye on all of them. We know that the first 18 months of any fledgling business is critical to their survival and later success.

“The growth in our economy is going to come from new businesses rather than established ones, which is why one of the key strategies for Yorkshire Forward, the regional development agency, is to improve the business birth rate in our region.

“But we need money to oil the wheels and for everyone who can to play their full part.”

Anyone who wants to know more about the Whyte Knight fund should track down Mr Whyte at the York Professionals stand at Venturefest Yorkshire at the York Racecourse tomorrow, or visit the fund’s website at yorkbac.co.uk