Good news for tech SMEs
A £20 million funding pledge has been made to deliver funding solutions for innovative SMEs.
British Business Bank Investments Ltd, the commercial arm of the British Business Bank, has increased its commitment in BOOST&Co’s Industrial Lending 1 fund by £20 million as part of an additional £40m extension to the fund.
BOOST&Co provides tailored debt solutions for innovative tech SMEs in Europe. Its Industrial Lending 1 fund provides venture debt loans of between £2m and £8m to innovative, fast growing companies looking to scale-up. These loans are available to early stage technology start-ups which have an established business model and can support their rapid growth prospects.
To date, the fund has made total commitments of £100m, with investments in 33 UK based SMEs. The additional investment means that it will make up to £100m of further commitments to SMEs.
British Business Bank Investment Ltd’s Investment Programme, which is providing the additional funding, has so far committed over £580m to providers of finance to UK smaller businesses. The programme helps to widen the choice of funding SMEs can find on the market.
Catherine Lewis La Torre, CEO, British Business Bank Investments Ltd, added: “This £20 million extension is a further demonstration of our commitment to promoting greater choice in the supply of lending to smaller businesses. Venture debt finance is an important option for innovative businesses that want to grow rapidly, as a form of capital that can help them scale-up without having to relinquish control of the business. We are pleased to support BOOST&Co as they expand the level of this type of funding they can provide to the market.”
Meanwhile other UK tech investors are also turning to the British Business Bank to plug a £2 billion funding hole left in the aftermath of Brexit. According to Business Insider, British venture capital forms reported in May that the European Investment Fund, which channelled £2 billion into the UK had frozen its funding after the Brexit referendum result.
The British Business Bank has been given the green light to hand out more money through its VC Catalyst Fund. This technically focuses on later stage funds of at least £50 million, but it has invested in some early stage funds too.
This is all good news for the tech sector.
For more information on investment funds for innovation and R&D give Richard Olsen a call on 0203 3270567.