Future Fund: Breakthrough Now Open for Investor Applications20 July 2021
Future Fund: Breakthrough, announced by the Chancellor of the Exchequer at Budget 2021, opens today for applications. This UK-wide programme will deliver £375m of government funding via British Patient Capital, a commercial subsidiary of the British Business Bank.
Due to high research and development costs, breakthrough technology companies typically require more capital than other companies, to fuel the later stages of their growth. Because of their ability to grow rapidly and have a significant economic impact, the growth of these innovative companies is critical to the UK’s future prosperity and economic recovery.
Through the Future Fund: Breakthrough programme, British Patient Capital will make equity co-investments with private sector investors in later stage R&D-intensive UK companies operating in breakthrough technology sectors, such as quantum computing, cleantech, and life sciences. British Patient Capital will construct a portfolio of growth-stage breakthrough technology companies over time.
Future Fund: Breakthrough is focused on an area of the market with a high need for additional patient capital. In order to be eligible for the scheme, companies must, inter alia, be raising a minimum total investment round size of £30m, and the maximum Future Fund: Breakthrough will contribute to an investment round is 30%. This means the minimum amount of private sector funding is £21m. The company must also have raised at least £5m of equity investment from third-party investors in previous funding rounds. As a fully commercial scheme, Future Fund: Breakthrough will invest on the same terms as private sector investors.
The scheme is separate and different from the now-closed Future Fund that provided convertible loans of up to £5m to a wide variety of innovative UK companies, to address the funding challenges caused by Covid-19. Read full news release.