The government’s Future Fund has taken an equity stake in 65 additional high-growth companies, according to data from the British Business Bank (BBB).
The latest list takes the total number of loans to have converted to equity to 400 as of 30 June 2022.
A number of peer-to-peer lending platforms participated in the Future Fund, including Assetz Capital, CapitalRise, FutureBricks, Crowd2Fund, Propio and JustUs, which has since seen its loan converted into equity.
Peer2Peer Finance News reported that the state development bank became a minority shareholder in the platform in December, in a transaction which valued JustUs at £50m.
Unlike an equity investment, there was not 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 were 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.
Besides the 400 to have converted to equity, out of a total 1,190 convertible loan agreements, there have been 54 administrations and 33 have fully exited the scheme, leaving 703 convertible loans as of 30 June 2022.
Launched on 20 May 2020, and open for applications up until 31 January 2021, the Future Fund issued £1.14bn in loans. Third-party investors were required to at least match the Future Fund’s investment.
The future fund was established to support UK-based innovative businesses affected by the Covid crisis, offering loans ranging from £125,000 to £5m.
“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,” said BBB Venture Solutions managing director Ken Cooper. “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.”
The BBB releases a list of companies in which Future Fund has a shareholding at the end of each financial quarter.