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Firms in London and the South East of England have received the lion’s share of the º£½ÇÊÓƵ Government’s £1.2bn convertible loan Future Fund.

The fund, which closed to new applications in January and is administered by the º£½ÇÊÓƵ Government’s economic development bank the British Business Bank, has provided finance to 1,236 mainly tech-focused firms.

Some 845 firms in London and the South East have secured £867.9m (70% of the total) of the funding, which has already seen a number of companies converting debt into equity so giving the º£½ÇÊÓƵ Government ownership stakes.

A condition of the Future Fund is that when debt is converted into equity the º£½ÇÊÓƵ Government gets a stake at a 25% discount to the required match funding investors.

The British Business bank said London accounting for 60% of companies is in-line with the wider market trends for equity investments. Its 2019/20 Small Business Finance Markets report showed that London received 66% of equity investment by value in 2019.

Future Fund Regional Breakdown

In Wales some 22 firms have secured backing from the fund with a total investment level of £11.9m. Recipients include hydrogen car venture Riversimple and cleantech firm Hydro Industries. Hydro has seen the debt converted into a 2.5% stake for the Westminster government.

In Scotland 22 firms have secured £8.6m of funding. London has seen 696 firms securing £720.1m with the South East 139 firms receiving £147.8m.

Senior management teams consisting solely of ethnic minority team members, and those with both ethnic minority and white team members, account for 61.6% of funding to companies that have been approved funding of £683.5m.