HSBC UK is to lend up to £250m for high-growth UK tech businesses looking to scale up.
The new Growth Lending fund will enable tech scale-ups to borrow up to £15m each to help IP and technology-rich businesses in cloud or software, healthtech, edtech, fintech and advanced manufacturing accelerate further growth.
The fund aims to support well-equitised, high-growth, loss-making scale-ups earlier in their growth journey by providing easier access to finance and international expertise.
High-growth tech scale-ups generally own few tangible assets, but are rich in intellectual property and intangible assets, so IP evaluation forms part of the credit decision process. The bank has also evolved its debt offering to cater for the needs of scale-ups.
The announcement of the new fund follows the government’s strategy to boost the tech sector unveiled at London Tech Week last week. The new strategy is focused on financing digital growth – particularly in AI, quantum computing and digital health start-ups – and commitment to improving the UK tech ecosystem.
Last week, Labour’s shadow chancellor Rachel Reeves launched a review into barriers holding back UK tech start-ups, including access to finance after lending to businesses fell to an all-time low in the first quarter of 2022 and London-staged IPOs to the lowest level since 2009.
Roland Emmans, head of UK tech sector and growth lending at HSBC UK, said: “Growth Lending is for businesses who want to become global tech players by working with a global bank. This is an ideal option for high-growth tech scale-ups, who are supported by a strong equity backing, have a proven sales track record, and a clear path to profitability.
“HSBC UK has a strong and growing technology sector franchise, and we are very excited to launch Growth Lending to help better serve our high growth scale up tech customers as the go-to bank for internationally focused, UK based tech firms.”