The British Business Bank has published a list of 158 companies in which the Future Fund holds an equity stake.
Launched on 20 May 2020, and open for applications until 31 January 2021, the Future Fund issued 1,190 innovative companies with Convertible Loan Agreements worth £1.14bn. Third-party investors were required to at least match the Future Fund’s investment.
East Midlands companies in which Future Fund is a shareholder include Kettering-based Better Tasting Drinks Co. Limited and Watkins Drinks Limited, Nottingham-based Mom Incubators LTD and Oneskee Limited, and Beeston-based Locate Bio Limited.
The Future Fund supports innovative UK companies that typically rely on equity investment to fund their growth. By creating a bridge to the next equity funding round, the Future Fund supported these companies through a period of considerable economic disruption and now the recovery.
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.
At 31 August 2021, 158 convertible loans had converted into equity shares, meaning the companies have successfully raised further private sector capital through an equity funding round.
Ken Cooper, Managing Director, Venture Solutions, British Business Bank, said: “The Future Fund was created to increase the flow of capital to innovative companies at the height of the pandemic, while ensuring long-term value for the UK taxpayer.
“We’re delighted to see so many companies already going on to raise further private sector capital. As a shareholder in so many promising businesses, the Future Fund is well positioned to support, and benefit from their continued growth.”