Rishi Sunak has been a busy man. No sooner had the UK Chancellor announced his immediate short-term package of support measures for UK businesses, he was in front of the cameras again to unveil the Future Fund.
“Our start-ups and innovative firms are one of our great economic strengths, and they will help spur our recovery from the pandemic,” Sunak said.
“The Future Fund will support firms across the UK to get through the pandemic by stimulating investment so that they can continue to break new ground in technology and innovation”
Following on the heels of the CBILS and JRS, the Future Fund is a long term support scheme that aims to provide government loans to UK-based companies ranging from £125,000 to £5m, subject to at least equal match funding from private investors.
These convertible loans may be an option for businesses that rely on equity investment and are unable to access other government business support programmes because they are either pre-revenue or pre-profit.
For a business to qualify for support via the Future Fund it will need to meet the following criteria:
- it is UK-incorporated – if your business is part of a corporate group, only the parent company is eligible
- it has raised at least £250,000 in equity investment from third-party investors in the last 5 years
- none of its shares are traded on a regulated market, multilateral trading facility or other listing venue
- it was incorporated on or before 31 December 2019
- at least one of the following is true:
- half or more employees are UK-based
- half or more revenues are from UK sales
The scheme is scheduled to run throughout 2020, and The government has said it will also amend the rules of the Enterprise Investment Scheme (EIS), which provides tax relief to investors in high growth firms, to protect Future Fund investors from losing relief on their previous investments made prior to any investment through the Future Fund.