The Viking Fund is a £5m venture capital fund founded by four experienced private sector investment managers and funded by the DBERR through its “Early Growth Fund” project. The fund is strictly commercial and is seeking to maximise profits but, because of the source of its funding, there are a few restrictions on what it can do:

• All of its investments must be matched by private sector investors on terms that are at least as good those of the private investor. Bank funding is not counted as matching funds.
• Investments are restricted to businesses based in the Yorkshire and Humber region.
• The maximum (initial) investment by the fund is £100,000 and it cannot get involved with equity funding rounds exceeding £250,000.
• The fund can invest up to a further £100,000 in the same business after a minimum period of nine months, subject to private sector matching funding.
• The DBERR funding is in the form of a repayable grant, due to be repaid after 10 years, together with 6% compound interest. Any remaining profits are to be divided between the DBERR and the management team. This provides a strong profit incentive for the management team.
• There are a small number of industry sectors that the Viking Fund is not allowed to invest in, mainly related to fishing and agriculture. These are unlikely to impact on the operation of the Fund.

In order to find the matching private sector investments, the Viking Fund was established alongside an ‘investment club’ made up of serious private investors. This provides Viking Club members with a substantial high quality deal flow from which to select, together with an opportunity to share the investment risks across a wider portfolio. Members can also share the burden of assessing and monitoring investments with fellow members and also Viking Fund.

Viking Fund is seeking between 40 and 80 investments over a five year period and will always give Viking Club m an opportunity to consider investing in the opportunities that it wishes to pursue. In addition to this, the Fund is also able to invest alongside other investors as well.