The Future Fund is up and running; more like sprinting, actually. On the first day, £453m was pledged to fund many of Britain’s most innovative businesses. That’s £906m as and (presumable) when it’s matched by the government. (The original plan was to limit the fund to £250m.)
The Future Fund is the right policy for the economic challenges we now face. As Sam Dumitiru explains on our blog, research suggests that VCs take fewer risks when funding is limited. This means less innovations and spillovers that make us all richer. This new fund will go some way to counteracting that.
The Entrepreneurs Network was a founding partner of the Save Our Startups campaign, so it is heartening to see the proof that there is demand for an equity-based solution to the current challenges. But from our vantage point certain people deserve singling out for getting it over the line, including Dom Hallas and Joel Gladwin at Coadec, serial entrepreneur Brent Hoberman, former special adviser to Prime Minister Daniel Korski, John Spindler of Capital Enterprise, Kerry Baldwin of IQ Capita, Emma Sinclair on the diversity front, Bim Afolami MP, and, the Chancellor Rishi Sunak. But most of all, the thousands of entrepreneurs reading this who got behind the Save Our Startups campaign. Pat yourself on the back!
For more information on the Future Fund:
– the British Business Bank has an eligibility checker;
– we have a pithy policy update;
– the British Business Bank has a useful FAQ;
– Jeff Lynn of Seedrs has written a thoughtful article;
– Sifted has an article on how to apply for the Future Fund;
– John Glen MP has written on why the Treasury doesn’t want it to be just for male-dominated, London-based businesses.
If you have any further questions we can raise them on your behalf with the British Business Bank. Just drop me an email. And keep us updated with how this policy is working at the coalface.
Creed is Good
The stereotype of economists is that they can’t come to a consensus. But if it's unanimity you’re looking for, take a look at the issue of free trade. As Paul Krugman claimed, if there were an economist’s creed it would include: “I advocate Free Trade". It’s something pretty much every economist believes, nay knows, to be true. Politics, however, gets in the way.
For economists, free trade is (rightly) considered from the perspective of consumers, who benefit from access to cheaper goods and more choice. Of course, at the business or sector level, changes to tariffs can have both positive and negative impacts on domestic businesses, so are not always welcome and cuts to them are lobbied against.
This Government has shown a rhetorical commitment to free trade. The post-Brexit tariff regime which has just been announced will eliminate tariffs on around 60% of goods, as opposed to the planned 87%. (As part of the EU there’s only tariff free trade on 47% of goods, but the downside is that if we leave without a decent deal we’ll have tariffs with our closest neighbours which is why most economists think Brexit will make us poorer.)
From next year there will be zero tariffs on all sorts of products, including copper alloy tubes, screws and bolts, dishwashers, tampons, vacuum flasks, bike inner tubes, LED lights, but also 10% duties on cars, and levies on beef and poultry as well as protections for the ceramics industry. As such, the headline is that the cost of imported food and cars will go up unless a deal is struck with the European Union.
Entrepreneurs can get guidance here on the UK tariffs that will apply from next year. You can search for tariff rates that will apply here. It doesn’t make for pretty reading – the complexity and exemptions are enough to make even the most heterodox economist cry.
Going for Gold
As the secretariat for the APPG for Entrepreneurship, we partnered this week with the APPG for Disability on a webinar focused on the impact of coronavirus upon entrepreneurs with a disability.
With Dr Lisa Cameron MP, Liz Johnson (the gold-medal winning Paralympic swimmer and entrepreneur) and Kush Kanodia (the serial social entrepreneur), we considered the public health challenges for some disabled entrepreneurs; the current support that government provides to entrepreneurs with disabilities; and the potential post-coronavirus changes (e.g. changing working patterns, technologies etc.) and how they might support entrepreneurs with disabilities.
The big takeaway is that the APPG for Entrepreneurship needs to do more work in this policy area. If this is a policy area that you’re interested in, get in touch – particularly if you or your company are keen to partner on a briefing paper considering the role of government in ensuring ambitious entrepreneurs with a disability are start and scale their businesses.
Future Proof