The Australian Treasury recently launched the Australian Business Growth Fund, a $540 million investment into Australia’s small businesses.
So what is it exactly, and how might it benefit your small business?
The Australian Business Growth Fund
The Australian Business Growth Fund (BGF) was initially announced in 2019, and officially launched on October 16 2020.
The Australian government made an initial investment of $100 million into the fund, and is joined by major banks ANZ, CBA, NAB, and Westpac, all of which committed $100 million each as well. Both HSBC and Macquarie Bank have added $20 million each.
As the fund matures, the hope is to reach $1 billion, all of which is slated for investment into small businesses around the country. It is all part of the government’s plans to help small businesses bounce back, to create jobs, and to stimulate the economy post-covid.
The key goals are to:
- Increase investments in SMBs throughout Australia
- Support the creation of new jobs and economic growth after the covid downturn
- Increase the availability of patient equity capital to small businesses
- Facilitate international and interstate trade and commerce
The BGF will make its investments into small businesses independently of the government, and will operate as a commercial organization. Each investment into small businesses must be commercially viable and make a return, and the fund should over time operate across industries and regions in Australia.
How can I get small business help from the Business Growth Fund?
Australian SMBs will soon be able to apply for long-term equity capital investments from the Business Growth Fund.
Companies can apply for investments between $5 million and $15 million, although there are a few eligibility requirements to meet before you apply (see below).
CEO of the fund, Antony Healy, has outlined that the organization is currently busy setting up its premises and building a network of talented individuals who will be able to offer their expertise down the line. He expects that the fund will be ready to start investing in small businesses in the first quarter of 2021.
In short, the Business Growth Fund is set to assist small businesses across Australia with sizeable cash investments that could help you take your business to the next level.
Am I eligible for the Business Growth Fund?
To be eligible to apply for the BGF, SMBs must have an annual revenue of between $2 million and $100 million. They must also have three consecutive years of profitability and revenue growth.
The fund’s investments will constitute a minority economic interest, usually between 10-40% of total, fully diluted, share capital.
Mr Healy has said that broadly, the fund will be looking for businesses that meet these three criteria:
- The business must have strong prospects for growth
- The business must have a proven track record of profitability (although the fund will take the covid downturn into consideration)
- The business must have quality management teams and owners that are committed to business growth
If you believe your business fits the bill, you will be able to apply in early 2021 when the Business Growth Fund begins accepting applications.
For now, you can prepare your documents and records in preparation, and continue building your company for profitability and growth. And to do that, you can use White Pages Connect to manage your digital presence, including your reviews, business details, and social media branding.