Backing the North’s tech stars

By Ryan Sorby, Partner and Head of the North in Palatine’s Growth Credit team

Manchester’s depth of work in fintech and digital health has made it one of Europe’s most active tech cities, drawing talent, capital, and global attention in equal measure. According to Invest Manchester, the city region is home to a £6 billion tech ecosystem with 4,885 digital businesses employing over 50,000 people.

The last 10-15 years has seen the emergence of some outstanding businesses in the region, Matillion, AO, THG, Auto Trader and Zuto become true powerhouses in their market places, while global brands like Amazon have set up bases here too.

Few places outside London therefore can point to the same density of technology expertise, university research output, and institutional backing that Greater Manchester has assembled over the past decade.

The community that will be celebrating Manchester Tech Week from 27 April to 1 May this year is a testament to what regional ecosystems can become when ambition meets human capital and infrastructure, and to the compounding effect of years of investment in the right sectors, the right institutions, and most importantly, the right people with the skills fast-growing tech businesses need.

At Palatine, we’ve had a front-row seat to that transformation. We’ve been backing businesses across the UK’s regions for years, and as a Manchester-born investor the city holds a special place in our heart.

It’s  not just because of our roots here, but because the quality of the companies being built in this city genuinely excites us. The ambition of the founders we meet, the sophistication of the ecosystem that supports them, and the scale of what’s still to come, all of it reflects a city that knows exactly where it’s headed.

Despite the huge progress that has been made over the last decade as Greater Manchester has earned its stripes as the fastest-growing city region in the UK, there is still more to do to be truly competitive on a European and world stage.

From a tech funding perspective, the UK regions, even Greater Manchester are still something of a poor relation, which is why we felt strongly at Palatine, there had to be a  new offering to bridge the funding gap for founders who had typically already raised VC funding but needed to push harder and faster to meet a market opportunity.

 

Our Growth Credit strategy

We launched our Growth Credit Fund in 2024 with a clear purpose – to give fast-growing, venture-backed tech businesses outside of London access to flexible, intelligent debt capital. Too often, this type of funding only flows only to companies in the London and the South East, and it creates a structural barrier for ambitious companies elsewhere across the regions. Growth credit is designed to break down those barriers and enable founders to scale up without surrendering more equity.

By providing non-dilutive financing, growth credit allows tech businesses to keep their equity and ownership while accessing the capital needed to grow. This type of financing sits alongside Venture Capital investment as a complementary layer of funding, acting as a bridge between funding rounds and the more structured world of traditional debt, giving companies the firepower to scale without having to compromise on ownership or direction.

Overall, this makes Growth Credit particularly well suited to regional scale-up businesses that require flexibility as they move from early traction to sustained growth. One Greater Manchester success story is Voly Group, one of our first Growth Credit clients. Our funding has helped support acquisitions, invest in people and build out its overall offering delivered through their software platform.

For companies like Voly the strength of growth credit lies in its adaptability, it can fund product and AI development, sales and marketing programmes that accelerate go-to-market efforts, talent acquisition in local markets, and international expansion, giving companies the runway to move into new geographies without the equity pressure that typically accompanies that kind of growth. And for regional founders, this flexibility is vital, providing the funds to scale on their own terms, all while remaining rooted in their local ecosystems.

 

Why this matters for scaling up

Access to the right funding at the right time is one of the most significant factors in whether a high-growth tech business scales successfully, and for a long time, that capital has been concentrated in London. When growth funding flows to one geography, the effects compound quickly, for example, talent follows capital, companies follow talent, and ecosystems develop unevenly as a result.

Growth credit has an important role to play in rebalancing this dynamic. Enabling businesses to access growth capital without needing to relocate or dilute ownership supports the development of stronger regional ecosystems. Companies can hire locally, invest locally, and scale from the cities where they were founded, contributing to more sustainable and better distributed economic growth.

By providing flexible, non-dilutive capital to regional founders, we give businesses the means to scale where they are, hiring locally, building locally, and putting down the kind of roots that strengthen their city’s tech ecosystem for years to come. Manchester is already proof that world-class tech businesses can be built and sustained outside the capital, and we’re proud to be part of the community that makes that possible.