Quick Read: The British Business Bank has invested £40 million into FDC’s £81.5 million Evolution Fund to support the growth of SMEs across the Midlands and North, with a focus on flexible financing and sustainability.
The British Business Bank has committed £40 million to Frontier Development Capital’s (FDC) new £81.5 million Evolution Fund, a move aimed at scaling access to finance for established small and medium-sized enterprises (SMEs) across the Midlands and North of England.
This significant funding boost is designed to help regional businesses unlock growth by providing flexible debt finance between £1 million and £8 million. A matching £40 million contribution from the West Midlands Pension Fund (WMPF) further solidifies the fund’s mission to drive inclusive economic development beyond London and the South East.
Fueling Growth and Sustainability
The Evolution Fund will support strategic financial activities such as management buyouts, acquisitions, debt refinancing, and shareholder restructures. It also features a strong focus on sustainability, with a portion of funds allocated to help businesses decarbonise and move toward net zero—aligning with the UK’s broader climate goals.
The fund is sector-agnostic and targets SMEs with a proven track record, robust growth potential, and experienced leadership.
Building on Regional Investment Success
FDC, headquartered in Birmingham and founded in 2016, has already invested over £200 million in regional businesses. This marks the firm’s second collaboration with the British Business Bank, following the launch of the FDC Debt Fund in 2020.
Adam Kelly, Managing Director and Co-Head of Funds at the British Business Bank, said:
“We are pleased to continue our support for FDC. Backing experienced fund managers helps us broaden access to finance across the UK’s nations and regions.”
Graham Mold, Head of Growth Capital at FDC, added:
“Many smaller firms still struggle to access tailored funding solutions, especially those needing less than £10 million. The Evolution Fund addresses this gap with flexible, deal-specific support.”
Shiventa Sivanesan, Assistant Director at WMPF, noted:
“This investment aligns with our responsible investment values. We’re proud to support regional SMEs and hope others will follow our lead.”
Strengthening Governance for Growth
As part of its broader expansion, the British Business Bank has appointed Joanna Wright as Interim Chief Risk Officer, effective May 2025. With over 30 years in financial services—including senior roles at Santander UK and Visa Europe—Wright’s appointment strengthens the Bank’s oversight during a period of increasing programme complexity.
A Strategic Move for UK Economic Resilience
The Evolution Fund is part of the Bank’s growing portfolio of regionally focused initiatives such as the Midlands Engine Investment Fund and Northern Powerhouse Investment Fund, helping to tackle geographic disparities in SME finance.
Beyond capital, the British Business Bank’s support represents a long-term commitment to economic resilience, innovation, and sustainable enterprise. By partnering with experienced regional investors like FDC, the Bank is catalysing the next phase of SME-led growth across underserved parts of the UK.
