Future Fund takes stake in another 30 firms as conversions slow
The British Business Bank’s Future Fund has an equity interest in an additional 30 companies, bringing the total up to 529, new data has revealed.
The state development bank launched the Future Fund during the pandemic to support innovative and high-growth companies. A number of peer-to-peer lending platforms participated in the scheme, including JustUs, Proplend and CapitalRise.
As of 31 March 2023, the Future Fund had 502 active loans, 529 equity interests, 49 cash realisations and 111 insolvencies in its portfolio.
In its latest quarterly update, the British Business Bank said that the level of conversions began to decline in the fourth quarter of 2022 compared to the previous quarter, and conversions in January and February remained low but began to increase slightly in March.
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The number of administrations also began to grow in this quarter, which it attributed to the weakness in the wider UK market and the banking crisis.
The latest companies to convert their Future Fund loans into equity stakes include Invicibles Studio, a mobile games developer based in Preston, and Northen Ireland-based Skurio, a digital risk protection platform that detects data breaches by monitoring the dark web.
Whilst conversions remained lower in this quarter, 15 conversions took place in companies based outside of London.
Launched on 20 May 2020, and open for applications until 31 January 2021, the Future Fund issued 1,190 companies with convertible loans worth £1.14bn in total. The government loans were subject to at least equal match funding from private investors.
“The Future Fund was created to ensure a flow of capital, at the height of the pandemic, to companies that would otherwise have been unable to access government support schemes, while ensuring long-term value for the UK taxpayer,” said Ken Cooper, managing director, venture solutions at the British Business Bank.
“The Future Fund is now entering the maturity phase, which signals three years since the first loans were executed. This is likely to increase the level of transactional activity rapidly over the coming months.”