UK Government announces new “Future Fund” for startups affected by COVID-19
Information detailing new support to keep startups afloat.
British government announces the introduction of a new “Future Fund” for high growth startups adversely affected by COVID-19.
With much uncertainty over how long the pandemic could last for, and many business practices halted for an unspecified duration of time, Founders and CEO's alike have grown increasingly concerned by the threat this poses to their startups' existence and longevity.
The British startup ecosystem is one that contributes hugely to the economy by employing millions and bringing highly innovative services to market, and even gave rise to eight tech unicorns last year alone.
For such companies to struggle or go bust as a result of the COVID-19 pandemic would have disastrous effect on the UK economy. Whilst the "Coronavirus Job Retention Scheme" and "Coronavirus Business Interruption Loan Scheme" are impactful steps in the right direction, startups still fear that this is not enough to keep them afloat, and more governmental support measures have therefore been requested.
In response, the new “Future Fund” - first announced by the government on Sunday 19th, April 2020 - pledges to launch in May, investing between £125,000 and £5 million in qualifying startups.
So, how will this work in practice?
The investment currently assumed as a convertible loan note will give businesses an injection of much needed immediate capital, with the option to repay the loan or part with equity stake in the future.
The British Business Bank, who are held responsible for managing the fund, will be allocated £250M of taxpayer money.
In order to qualify, businesses "must secure an equal or greater amount of match funding from private investors, and be a U.K. registered private company that has previously raised at least £250,000 in private investment in the last five years".
For more information on eligibility, and how to access the government fund(s) and business management during this time, we will be holding an informational webinar session this Wednesday 22nd April, in collaboration with The Entrepreneurs Network and with a business finance expert from Beauhurst.
There will be Q&A and networking throughout this free webinar. You may register here.
Whether you need to seek funding, or find alternative ways to manage your company, contact us today so we can discuss your business options to ensure you are equipped to survive and thrive COVID19.
Let's save our startups.