465 companies have been approved for £468.7m worth of convertible loan agreements since the government’s future fund launched on 20 May, data from the British Business Bank has showed.
In the first two months of its operation, there have been 781 applications for the future fund, which offers convertible loans ranging from £125,000 to £5m from the government, subject to at least equal match funding from private investors.
The state development bank said that the companies set to receive funding under the scheme are diverse in terms of location, gender and ethnicity.
Read more: Chancellor expands the future fund
Over a third (39 per cent) of funding approved to firms are headquartered outside of London.
Of this, 17 per cent is to companies with their headquarters in the South East and South West, 11 per cent in the North West, North East and Yorkshire and the Humber, six per cent in the East of England, two per cent in the Midlands and two per cent in Scotland, Wales and Northern Ireland.
61 per cent of the companies are in London, in line with the 66 per cent figure for equity investments in the capital last year, according to the British Business Bank’s 2019/20 small business finance markets report.
Furthermore, 82 per cent of funding under the scheme has been to businesses with mixed gender senior management teams. The fund will give the Treasury data on founder gender as part of its commitment to sign its Investing in Women Code.
In addition, 63 per cent of funding has been approved to Black, Asian and minority ethnic (BAME) only and mixed ethnicity management teams.
The British Business Bank said it will release a report in the autumn exploring the state of entrepreneurship in the UK, and that this will also include data on location, gender and ethnicity.
Some peer-to-peer lending platforms are using the future fund to match the money they receive from fundraising rounds.
P2P lending platform Assetz Capital is currently using the government’s future fund to support its latest Seedrs equity crowdfunding campaign, in order to scale and prepare for lending under the coronavirus business interruption loan scheme.
Propio is hoping to utilise the government’s future fund to match £150,000 from private fundraising efforts to raise £300,000. This will be used to support its delayed move into the P2P lending space.
Meanwhile, some debt platforms are using their crowdfunding abilities to allow other companies to raise the private funding they need to take part in the scheme.
Crowd for Angels is allowing firms to raise investment for the future fund on its platform, with investors able to put the money into an Innovative Finance ISA.
Similarly, as part of its planned relaunch, P2P lender Crowd2Fund aims to introduce a future fund product that has the ability for private investors to co-invest alongside the government, to give another source of capital for small- and medium-sized enterprises.