Innovative firms promised extra funding supportPrint publication
On 20 April 2020, the Chancellor of the Exchequer, Rishi Sunak, announced a new £1.25 billion support package designed to protect firms driving innovation during the Covid-19 pandemic. The package includes a £500 million investment fund (called the Future Fund) for high-growth companies impacted by the crisis, made up of funding from government and the private sector and £750 million of grants and loans for small and medium enterprises (SMEs) focusing on research and development.
The Chancellor said the targeted and tailored help “would ensure firms in some of the most dynamic sectors of the UK economy – ranging from tech to life sciences – are protected through the crisis so they can continue to develop innovative new products and help power UK growth“.
The Future Fund
According to the Government’s website, the £500 million Future Fund has been designed to help high-growth companies across the UK receive the investment they need to continue during the crisis. Delivered in partnership with the British Business Bank and launching in May, the fund will provide UK-based companies with between £125,000 and £5 million from the government, with private investors at least matching the government commitment. These loans will automatically convert into equity on the company’s next qualifying funding round, or at the end of the loan if they are not repaid. To be eligible, a business must be an unlisted UK registered company that has previously raised at least £250,000 in equity investment from third party investors in the last five years. The government is committing an initial £250 million in funding towards the scheme, which will initially be open until the end of September.
SME grants and loans
The £750 million of grants and loans to R&D SMEs will be available through Innovate UK’s grants and loan scheme. Innovate UK, which is the national innovation agency, will accelerate up to £200 million of grant and loan payments for its 2,500 existing Innovate UK customers on an opt-in basis. An extra £550 million will also be made available to increase support for existing customers and £175,000 of support will be offered to around 1,200 firms not currently in receipt of Innovate UK funding. The Government hopes that the first payments will be made by mid-May.
Please call your usual contact within Walker Morris if you need any help accessing this government funding.