The UK government is expanding the £500m Future Fund for UK firms that have been adversely affected by the coronavirus pandemic, allowing businesses that have moved their HQs abroad to access the scheme.
The change means that startups who partook in overseas accelerator programmes and those that don’t have a UK-based parent company can apply. Applicants will have to provide evidence that at least half of their staff are UK-based and that at least 50% of revenues are from UK sales.
“This change means that those startups who have strived to be the very best, and taken opportunities to grow their business, will be able to benefit from our world-leading Future Fund,” chancellor Rishi Sunak said.
What is the Future Fund?
The Future Fund, which has seen a surge in demand recently, provides convertible government loans totalling between £125,00 to £5m. Its aim is to help adversely affected early-stage companies in sectors such as tech and life sciences.
To be eligible for the loan, companies must have previously raised a minimum of £250,000 in equity investments. The government loans are matched by private investors and its share converts to equity if it isn't repaid.
The government initially pledged £250m, however it has since approved £320m of loans to over 320 startups. The Treasury has not yet confirmed whether there is a cap for the expanded fund.
Unlike other schemes such as the Bounce Back Loan Scheme (BBLS) and theCoronavirus Business Interruption Loan Scheme (CBILS), Future Fund loans are distributed by the government-backed British Business Bank.
In other news, figures released on 30 June show that so far, over 1m firms have been granted emergency funding through the BBLS, CBILS and CLBILS combined.
Get in touch with the Funding Options team to find out what funding your business might be eligible for.