A direct co-investment fund has been launched for growth-stage innovative, R&D-intensive UK companies seeking relatively large investments.
The Future Fund: Breakthrough scheme has been created to drive investment in high growth, innovative, and research and development (R&D) intensive UK firms bringing game-changing technologies to market. The aim is to create new jobs and boost the country’s post-pandemic economic recovery.
Through the programme, the Government will co-invest with private investors to help scale-up innovations across high-growth firms. It is estimated that 1% growth in these firms could grow the UK economy by £38 billion.
Due to high R&D costs, breakthrough technology companies typically require more capital than other technology companies to fuel the later stages of their growth. Through the commercialisation of R&D, these companies can accelerate the deployment of innovative technologies that can transform major industries, develop new medicines, and support the transition to a net zero economy.
Support is provided as an equity investment. Alongside private sector investors, the Government will commit £375 million of funding to fast-growing firms looking to raise at least £30 million of investment. Companies must have raised at least £5 million in previous funding rounds. The maximum Future Fund: Breakthrough share of an investment round is 30%.
The scheme is open to R&D intensive companies with well-established UK operations, including life sciences, quantum computing and clean technology. To be eligible, businesses must have commitments of 70% of an investment round from private investors with a track record of financing innovative companies – such as venture capitalists.
The scheme is open for applications now and it will operate on a rolling basis with no deadlines.