Assetz Capital will look at taking advantage of the new future fund, which was unveiled in last month’s Budget to replace the original initiative.
In his financial statement, Chancellor Rishi Sunak revealed ‘future fund: breakthrough’, a new £375m scheme which will encourage private investors to co-invest with government in high-growth, innovative firms.
The initiative will target research and development (R&D) intensive companies seeking a minimum of £20m to support their growth.
The scheme is separate to the government’s future fund, which launched last May but has now closed to applications.
Assetz Capital raised £1.5m under the first future fund and chief executive Stuart Law said he will “certainly look” at the future fund: breakthrough.
“We’re certainly an intense R&D company,” he told Peer2Peer Finance News.
“I can see why that is a requirement. So, we have very substantial research and development claims because we have immense research and development, and it is only going to increase this year and next.
“And the technology that we’re building and planning to build, particularly over the next couple of years, will finally cement us as a competitor.”
The future fund offered convertible loans ranging from £125,000 to £5m from the government, subject to at least equal match funding from private investors, to address the immediate funding challenges that innovative companies faced due to the pandemic.
In contrast, future fund: breakthrough has a minimum investment round size of £20m, which is likely to impact which companies utilise the scheme.
Lee Birkett, founder of JustUs, which raised £1.2m using the future fund, suggested that the new scheme might be less applicable for P2P platforms due to the higher minimum investment requirement.
“The future fund has worked well for us,” Birkett said.
“I thought the new scheme looked good when I thought it was continuing the same terms, but I saw it had a minimum of £20m which is crackers.
“Unlike the recovery loan scheme and the coronavirus business interruption loan scheme where it looks to be a continuation, the new future fund looks to be very restrictive and less applicable for P2P platforms.”