The group behind the Banyan Bar & Kitchen, BOX and Manahatta venues has secured a £19m investment from BGF.
Arc Inspirations operates locations in Manchester, Leeds, Newcastle, Birmingham, Ilkley, York and Harrogate.
BGF has taken a minority stake in the Martin Wolstencroft-led business which will use the additional capital to double its footprint over the next few years.
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Mr Wolstencroft said: "We’re absolutely delighted to have secured this investment from BGF who are committed investors with a track record of supporting growth and success in the hospitality and leisure sector.
"This funding will enable us to expand our business significantly, allowing us to take advantage of substantial market opportunities over the next few years, as we take our winning brands to more key cities across the UK."
The deal marks the first time Leeds-based Arc Inspirations has introduced external investment to the group.
Its expansion to date, since Mr Wolstencroft and co-founder Chris Ure launched the business in 1999, has been funded by the business and more recently through a renewed partnership with HSBC.
Mr Wolstencroft, Mr Ure and managing director Anni Opong remain significant shareholders in the business.
Barry Jackson, head of BGF in Yorkshire and North East, said: "Arc Inspirations is an ambitious business with proven concepts and sights set on expansion across the UK regions.
"We have experience of successfully supporting similar businesses on this journey. Arc has already achieved an impressive scale and we look forward to working with Martin, Chris and the team to deliver against the plan to take the business to the next level."
Mr Wolstencroft added: "This investment marks a new phase for our business and is a genuine landmark moment for us, in our 20-year-plus journey, from when Chris and I opened our first bar in Headingley, Leeds, to where we are now with a group of 18 leading businesses run by a team of outstanding operators.
"It’s a brilliant outcome and the reason we have been able to do it is down to our people. The determination and effort they have poured into the business every day, especially in the past year, has been exceptional and we’re really excited about the future and what is possible."
Advisers to the deal:
Arc Inspirations – KPMG (Christian Mayo), Gordons (James Fawcett, Amy Pierechod and Lauren Wurzal)
BGF – Squire Patton Boggs (Paul Mann, Joshua Lodge and Sarah Hardman)
