The British Business Bank has published a list of 53 additional companies in which its Future Fund holds an equity stake, including two based in Scotland.
The update takes the total to 515 as at end of December, for the UK Government’s economic development bank.
Edinburgh-based Roslin Technologies, a biotech company improving protein production for cultivated meat, and Phlo Technologies, an online pharmacy business headquartered in Glasgow, both joined the list last year.
RoslinTech closed an £11m Series A capital raise, led by life sciences investor Novo Holdings, in November, while Phlo raised an undisclosed amount in a Series A funding round in December.
Launched on 20 May 2020, and open for applications until 31 January 2021, the Future Fund supported UK companies that typically rely on equity investment to fund their growth. By creating a bridge to the next equity funding round, the aim was to support these companies through a period of considerable economic disruption - and now the recovery.
Ken Cooper, managing director for venture solutions at the British Business Bank, said: “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.
“We are pleased to see so many of those companies now going on to raise further private sector capital, which will allow the Future Fund to benefit from their continued growth.”
Breakdown of total book
Convertible loans |
550 |
Investments where Future Fund retains an equity interest |
515 |
Fully exited |
43 |
Administrations and insolvencies (still in loan status) |
83 |
Total |
1,191 |
The scheme used a recognised financial instrument known as a convertible loan. Unlike an equity investment, there wasn’t a requirement under the convertible loan to value the company or the price of its shares, at a time when company valuations had been significantly impacted by Covid-19.
Instead, the convertible loans are designed to convert into equity at the next equity funding round, converting at a discount to the price per share agreed between companies and investors in the funding round.
The Future Fund targeted businesses were unable to access other government business support programmes, such as CBILS, because they are either pre-revenue or pre-profit and typically rely on equity investment.
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