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Chancellor Healey Commits £150m British Business Bank Fund to Scale Up Northern England's High Growth Firms

Writer: Shawn Jhanji
Shawn Jhanji
4 days ago
3 min read
More on the theme of founders building outside London, with a message this week, from the Treasury which was explicit: growth capital is being redirected toward the regions, not just topped up in the capital. UK venture funding has long been concentrated disproportionately in London and the South East, a pattern that shows up consistently in British Business Bank and Beauhurst data year after year, and that leaves high-growth companies in the North of England competing for scale-up capital against a much thinner set of local options than their London peers. It is the kind of structural gap that rarely makes a single dramatic headline, but quietly shapes which founders get the chance to grow their business into a national or global one. In his first major speech as Chancellor, delivered on 6 and 7 September 2026, John Healey set out to change that arithmetic directly. The centrepiece was a new British Business Bank fund of up to £150m dedicated to high-growth businesses across the North West, North East, and Yorkshire and the Humber. The fund is expected to make individual investments of between £5m and £15m, a ticket size squarely aimed at the scale-up stage, where companies have moved beyond angel and seed funding but are still too early, or too regionally based, for many London-centric growth funds to easily reach. It is designed to back university spinouts and other innovative, high-growth companies, and will complement the Bank's existing Northern Powerhouse Investment Fund II and Regional Angels Programme rather than replace them. The announcement is explicitly tied to the government's wider devolution push, working alongside Greater Manchester mayor Andy Burnham's ambitions for what Healey has described as growth in every postcode. Healey also used the speech to set a new ambition to double the number of UK unicorn companies, alongside a commitment to strip back unnecessary consultation, litigation and administrative barriers that founders and investors have long flagged as slowing growth-stage deals. The fund's expected sector focus, creative industries, clean energy, and space and technology, tracks reasonably closely with areas of genuine regional strength, rather than trying to import a London sector mix wholesale. What makes this fund worth watching is not the headline number itself, £150m is a meaningful but not enormous sum against the scale of the UK's growth capital gap, but the ticket size and its explicit targeting of the funding stage where regional founders are most likely to have to leave their region, or lose control of their company, to secure the capital to scale. A founder with a strong seed round behind them in Leeds or Newcastle has historically faced a choice between accepting terms from a small number of local investors or building a relationship with a London fund that may have limited appetite to lead outside the M25. A dedicated, appropriately sized regional scale-up fund does not solve that problem by itself, but it does widen the realistic set of options at exactly the point where founders currently have the fewest. The test now is deployment speed and terms. Healey's speech comes ahead of his first Budget on 28 October, against a backdrop of rising government borrowing costs, so how quickly the British Business Bank can get this fund operating, and how founder-friendly its terms prove to be relative to a typical London growth round, will determine whether it becomes a genuine alternative route to scale capital or a well-intentioned pool of money that moves too slowly to matter to the founders it is aimed at. Key Takeaways Chancellor John Healey announced a new British Business Bank fund of up to £150m for high-growth businesses across the North of England, in his first major speech as Chancellor on 6 to 7 September 2026. The fund is expected to make investments of £5m to £15m, targeting the scale-up stage where regional founders often have to look to London for growth capital. It complements the existing Northern Powerhouse Investment Fund II and Regional Angels Programme, and is explicitly linked to the government's devolution agenda and an ambition to double the number of UK unicorns. The fund's real test will be deployment speed and the founder-friendliness of its terms, ahead of the Chancellor's first Budget on 28 October 2026.

More on the theme of founders building outside London, with a message this week, from the Treasury which was explicit: growth capital is being redirected toward the regions, not just topped up in the capital.


UK venture funding has long been concentrated disproportionately in London and the South East, a pattern that shows up consistently in British Business Bank and Beauhurst data year after year, and that leaves high-growth companies in the North of England competing for scale-up capital against a much thinner set of local options than their London peers. It is the kind of structural gap that rarely makes a single dramatic headline, but quietly shapes which founders get the chance to grow their business into a national or global one.


In his first major speech as Chancellor, delivered on 6 and 7 September 2026, John Healey set out to change that arithmetic directly. The centrepiece was a new British Business Bank fund of up to £150m dedicated to high-growth businesses across the North West, North East, and Yorkshire and the Humber. The fund is expected to make individual investments of between £5m and £15m, a ticket size squarely aimed at the scale-up stage, where companies have moved beyond angel and seed funding but are still too early, or too regionally based, for many London-centric growth funds to easily reach. It is designed to back university spinouts and other innovative, high-growth companies, and will complement the Bank's existing Northern Powerhouse Investment Fund II and Regional Angels Programme rather than replace them.


The announcement is explicitly tied to the government's wider devolution push, working alongside Greater Manchester mayor Andy Burnham's ambitions for what Healey has described as growth in every postcode. Healey also used the speech to set a new ambition to double the number of UK unicorn companies, alongside a commitment to strip back unnecessary consultation, litigation and administrative barriers that founders and investors have long flagged as slowing growth-stage deals. The fund's expected sector focus, creative industries, clean energy, and space and technology, tracks reasonably closely with areas of genuine regional strength, rather than trying to import a London sector mix wholesale.


What makes this fund worth watching is not the headline number itself, £150m is a meaningful but not enormous sum against the scale of the UK's growth capital gap, but the ticket size and its explicit targeting of the funding stage where regional founders are most likely to have to leave their region, or lose control of their company, to secure the capital to scale. A founder with a strong seed round behind them in Leeds or Newcastle has historically faced a choice between accepting terms from a small number of local investors or building a relationship with a London fund that may have limited appetite to lead outside the M25. A dedicated, appropriately sized regional scale-up fund does not solve that problem by itself, but it does widen the realistic set of options at exactly the point where founders currently have the fewest.


The test now is deployment speed and terms. Healey's speech comes ahead of his first Budget on 28 October, against a backdrop of rising government borrowing costs, so how quickly the British Business Bank can get this fund operating, and how founder-friendly its terms prove to be relative to a typical London growth round, will determine whether it becomes a genuine alternative route to scale capital or a well-intentioned pool of money that moves too slowly to matter to the founders it is aimed at.


Key Takeaways

  • Chancellor John Healey announced a new British Business Bank fund of up to £150m for high-growth businesses across the North of England, in his first major speech as Chancellor on 6 to 7 September 2026.

  • The fund is expected to make investments of £5m to £15m, targeting the scale-up stage where regional founders often have to look to London for growth capital.

  • It complements the existing Northern Powerhouse Investment Fund II and Regional Angels Programme, and is explicitly linked to the government's devolution agenda and an ambition to double the number of UK unicorns.

  • The fund's real test will be deployment speed and the founder-friendliness of its terms, ahead of the Chancellor's first Budget on 28 October 2026.


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