REUTERS/Henry Nicholls
- The founders and CEOs of UK's most highly valued startups have cosigned a letter demanding financial support from the UK government - as the coronavirus pandemic threatens to put them out of business.
- Many startups don't qualify for the UK government's "coronavirus business interruption loan scheme" as banks don't consider them viable.
- We got a copy of the letter sent to chancellor Rishi Sunak - signed by the likes of Deliveroo and Darktrace - below.
- Click here for more BI Prime stories.
The founders and chief executives of some of the UK's most highly valued startups have written to the government demanding access to greater financial support, as the coronavirus pandemic threatens to put many out of business.
Founders including Deliveroo CEO Will Shu, Babylon founder Ali Parsa, and Darktrace co-CEO Poppy Gustafsson were among 12 co-signatories on the letter, addressed to chancellor Rishi Sunak. All three are valued above $1 billion, along with co-signatories Improbable and Graphcore.
Despite their promise, the companies are loss-making and therefore don't qualify for the government's "coronavirus business interruption loan scheme", as they are unlikely to be deemed "viable" by banks. Sunak introduced the scheme in March to allow businesses impacted by the coronavirus to apply for up to £5 million in loans.
Read the letter addressed to Sunak - signed by representatives from the likes of Deliveroo and Darktrace - below:
Dear Chancellor,
We greatly appreciate the significant steps that you have taken to help British businesses through the COVID-19 crisis. But as founders and CEOs of leading UK companies we are concerned that unless urgent changes are made to the current schemes then the high-growth UK tech sector will be put at risk.
As innovative companies we build technology and systems that transform sectors. For customers, we drive costs down, standards up and for society we create whole new categories of products and services. We are vital to productivity, clean growth and UK exports.
But unfortunately, the COVID-19 lending schemes you have put in place benefit established firms and do not help companies of the future such as ours. The businesses we run serve millions of customers across the UK, and overseas.
We are stepping up to help the country at this difficult time by helping tens of thousands of small businesses to continue operating, helping vulnerable customers get essential services and using innovative technology to give the NHS better tools to tackle the pandemic.
The high-growth tech sector has introduced innovative new products that have improved the lives of millions of customers in the UK and many more around the world. We have created huge numbers of high skilled jobs and we export across the globe.
Our sector will be crucial to helping the UK economy bounce back quickly after the pandemic.
The UK tech community is a world class engine for innovation and growth, however, it has not yet received Government support, unlike our competitors in France and Germany.
Our companies have all invested in technology and growth rather than short term profitability, which means that we are currently unable to access the schemes which have been designed with longer-established businesses in mind.
The current schemes that you have put in place - the Covid Corporate Financing Facility (CCFF), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Coronavirus Business Interruption Loan Scheme (CBILS) - are not accessible to our businesses.
We are therefore writing to ask you to urgently set up a taskforce meeting of leading tech businesses to work with you and your officials to find a way for high-growth tech companies to be able to access the lending schemes you have already established or new schemes if necessary.
As you said in your Budget speech earlier this year, to help Britain's businesses lead the next generation of high productivity industries, we need to invest in the technologies of the future.
The high-growth tech sector has a vital role to play in the future success of the UK economy, and we urge you to work with us to ensure that it is helped through the crisis and that the UK is still the best place in the world to build a tech company.
Ali Parsa, Babylon
Joanna Shields, BenevolentAI
Peter Smith, Blockchain
Hayden Wood, Bulb
Azmat Yusuf, Citymapper
Poppy Gustafsson, Darktrace
Will Shu, Deliveroo
Marc Warner, Faculty
Stan Boland, Five AI
Hiroki Takeuchi, GoCardless
Nigel Toon, Graphcore
Herman Narula, Improbable