Helena Morrissey and Nicola Horlick are among the signatories of an open letter to the chancellor calling for the government to take a more inclusive approach to its fund for start-ups that need support during the Covid-19 outbreak.
The £250m Future Fund will provide funding for founders that have already raised £250,000 worth of capital over the last five years. It will initially provide a bridging loan, between £125,000 to £5m, that will convert into equity over three years.
But concerns have been raised that the scheme was largely devised by men and that it will exacerbate the existing funding gap for women and minorities in the venture capital space.
A letter from entrepreneurs Hephzi Pemberton and Emma Sinclair called for the Future Fund to have an “aspirational target” to support founders from a wide range of social and ethnic backgrounds.
The letter said: “Diverse founders are less likely to have raised at least £250k of funding already, less likely to have ‘warm introductions’ and therefore less likely to have access to this funding.
“When only 1% of VC funding in 2019 went to female founders, there is an urgent need to ensure that the UK funds innovations from a broader range of founders.
“In addition, it is often the case that more diverse founders are the ones solving problems for underrepresented groups.”
Morrissey (pictured) and Horlick are among the City leaders who have signed the letter. Finncap chief executive Sam Smith is another signatory.
The letter concluded: “We the signatories on this letter are happy to collaborate with government to help ensure we enable the most innovative businesses from a diverse range of founders to be funded, to benefit both the economy and wider society.”
