Government announces Future Fund for innovative businesses
The Government has announced a new fund aimed at supporting innovative companies that are suffering financially as a result of the current crisis.
The Future Fund will provide government loans to UK-based companies, ranging from £125,000 to £5 million, subject to at least equal match funding from private investors. The scheme will be delivered in partnership with the British Business Bank. The total fund is anticipated to be £250m, and be available until September 2020.
The Government has suggested that these convertible loans may be a suitable option for businesses that rely on equity investment and are unable to access the Coronavirus Business Interruption Loan Scheme.
The scheme launched this month and we are told that more information, including full eligibility criteria, will follow over the coming weeks.
For now, it appears that your business could be eligible if it:
- is based in the UK;
- can attract the equivalent match funding from third-party private investors and institutions; and
- has previously raised at least £250,000 in equity investment from third-party investors in the last 5 years.
The funds can only be used for working capital purposes. Businesses can’t use the funds to make loan repayments, or pay bonuses or make dividends. The loans will mature after 36 months, and there are various triggers to the loans converting to equity.
More detail is required, but this is another potential strand of Government financial support that’s potentially available to businesses.
GET IN TOUCH
If you’d like a steer on what Government support is available for your business, please get in touch with Gurpreet Sanghera and we will point you in the right direction.
All information in this document is accurate at the time of writing. It is meant for general information only and is not legal advice.