A new company helping entrepreneurs to access up to #2 million of equity finance has been launched by Advantage Business Angels.
ABA Corporate Finance, which is registered with the Financial Services Authority, will fill a hole in the investment market for small firms, the start-up and business support organisation has said.
ABA Corporate Finance will be open to firms across the UK, although it hopes to build its base in the West Midlands.
The company will be run by the existing staff at Advantage Business Angels from the organisation's offices in Edgbaston.
Neil Mackay, managing director of ABA Corporate Finance said: "There remains a big gap in the market for fund-raising and corporate finance advice to companies who cannot afford the costs of traditional advisors.
"Many of our 'angel' investors have built very successful businesses and either sold them or floated them: their advice can make a real difference to a business and the cost of their advice is wrapped up in the equity deal. ABA Corporate Finance will be the vehicle to harness this capability.
"Our strategy now includes the additional capabilities that come with being an FSA registered business – the ability to put together larger deals up to #2 million plus the confidence given to the bankers; accountants and lawyers who are considering referring clients' seeking funding to us."
The launch of ABA Corporate Finance also coincides with the Government's #30 million Seraphim Capital Enterprise Fund.
ABA investment director Bob Barnsley is a board member for the fund, which was established using #10 million of private equity and #20 million Government money.
ABA was amongst a UK and US consortium of business angels that beat off 44 other bids in a competitive tender to develop the Department of Trade and Industry initiative.
ABA Corporate Finance will use a combination of funds, such as Seraphim, and angel investors to seek finance for small or early stage businesses.
Mr Mackay said: "At Advantage Business Angels we have made significant progress. A recent independent consultants' report confirmed that we are in the top four UK brokers for funding early stage businesses having completed over 96 deals and raised some #12 million over the last few years.
"The launch of ABA Corporate Finance and the Seraphim Fund is a double whammy for the professional and financial sector in Birmingham and will open up new opportunities for the city's bankers, accountants and lawyers."
ABA chairman, Sir Bernard Zissman, said he hoped that the new company could develop a strong base in the Midlands, which was a hotbed for innovative firms.
Sir Bernard said: "In today's costly financial climate, the urgency and importance to provide an affordable source of funding and encourage new young businesses to start and grow is the foundation of the future economic and employment base of the region.
"These two initiatives should be welcomed and embraced by everyone who seeks to expand and develop the skills and wealth creation of an international trading city."
