Deadline for Future Fund applications

Posted: January 26, 2021

Time is running out for any companies wanting to make an application for a convertible loan from the British Business Bank’s Future Fund.  The Future Fund closes for new applications at 23:59 on Sunday 31 January 2021. 

Although the initial application must be made by the lead investor, the investee company must have also completed their part of the initial application by this deadline.

The Future Fund provides convertible loans to UK-based companies that typically rely on equity investment, as part of the UK Government’s package of financial support measures designed to help businesses as a result of the Covid-19 pandemic. 

The value of the convertible loans ranges from £125,000 to £5 million, subject to at least equal matched funding from private investors.

To be eligible for the scheme, the company must meet the following criteria:

  1. The company must have raised at least £250,000 in equity from third-party investors in previous funding rounds in the last five years (from 1 April 2015 to 19 April 2020, inclusive).
  2. If the company is a member of a corporate group, it must be the ultimate parent company.
  3. The company must not have any of its shares or other securities listed on a regulated market, a multilateral trading facility, a recognised investment exchange and/or any other similar market, stock exchange or listing venue.
  4. The company must be a UK incorporated limited company or be eligible to apply as a non-UK parent company (there are specific eligibility criteria for non-UK parent companies).
  5. The company must have been incorporated on or before 31 December 2019 (or for a non-UK jurisdiction company, this criterion applies only to at least one UK subsidiary operating company).
  6. At least one of the following must be true for the company (this criterion applies to the company’s group):
    • half or more employees are UK based; and/or
    • half or more revenues are from UK sales.

Proceeds of the convertible loans are to be used for the investee company’s operating expenditure and/or capital expenditure in respect of its own business (there are specific restrictions on how the monies may be used).

For corporate support, please contact Ben Gisbey, Partner, Simkins LLP