19 May 2020

Coronavirus: UK Future Fund scheme – Final details announced


Iain Cockburn
Partner | UK

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On 18 May 2020, the UK Government announced final details of its Future Fund scheme to support high-growth companies in the UK.

The terms of the scheme are broadly in line with the initial headline terms that were announced last month, with some of the key points being as follows:

  • The scheme is open for applications from Wednesday 20 May 2020.
  • The scheme will not be made available to SEIS and EIS investors, as the requirement for private co-investors to invest in the form of a loan note has been retained.
  • UK subsidiary companies with overseas parents will not be eligible for the scheme, with investments only being made into ultimate parent companies within a group, and then only if that parent company is UK incorporated.
  • The process is investor-led, which means that the lead investor in any financing round must make the application in connection with the investee company.
  • The investment must be made under a standard form template agreement, that is available on the website of the British Business Bank. As stated above, the terms of this agreement broadly track the headlines terms announced by the Government last month.
  • In order for a company to be eligible, it must fulfil the following criteria:
    - It must have raised at least £250,000 in equity from third party investors between 1 April 2015 and 19 April 2020.
    - If it is a member of a group, it must be the ultimate parent company.
    - Its shares or other securities must not be listed.
    - It must be incorporated in the UK.
    - It must have been incorporated on or before 31 December 2019.
    - It must have at least half of its employees based in the UK or it must receive half of its revenues from UK sales.

Extensive lists of FAQs have been included on the website of the British Business Bank at the following links:

FAQs FOR INVESTORS: FUTURE FUND

FAQs FOR COMPANIES

For further details of the Future Fund scheme, please contact the Withers tech team.

Iain Cockburn Partner | London

Category: Article