British Business Investments announces a £20m funding facility with Sprk Capital to advance UK innovation

British Business Investments today announces an initial £20m funding facility to Sprk Capital Limited (“Sprk”). The facility will provide capital to smaller businesses in the UK engaged in innovation.

British Business Investments, a wholly-owned commercial subsidiary of the British Business Bank, aims to improve access to alternative finance for smaller businesses across the whole of the UK, while supporting the UK’s transition to a net zero economy. Since it was established in 2014, British Business Investments has committed more than £3.8 billion to providers of finance to UK smaller businesses.

Sprk is a leading specialty lender to companies engaged in the innovation sector. Through the provision of advanced funding of UK R&D and innovation grants, Sprk provides non-dilutive cashflow solutions to smaller businesses, enabling them to invest with confidence in their innovation projects. R&D advance funding, also known as an R&D tax credit loan, is a simple way for businesses to access their R&D tax credits at any point in the financial year. Grant advance funding, also known as innovation grant funding, is a simple way for businesses to finance their grant awards ahead of incurring expenditures.

Currently, innovation incentives such as tax credits and grants account for £16bn of funding to smaller businesses in the UK ^{Read footnote text 1} . Since it launched in 2021 Sprk has provided funding to innovation projects totalling over £150m. Although Sprk has a sector agnostic lending strategy, 80% of its loans to date broadly represent the UK innovation market, with lending focused on the manufacturing, IT & communication, and the professional scientific and technical sectors.

Sprk is the first lender focused on the innovation lending sector to receive funding from British Business Investments.

In 2024, the British Business Bank and Innovate UK signed a memorandum of understanding to help create new pathways for business investment and promote growth through innovation. The collaboration will see the two organisations working more closely together to co-create new opportunities to promote investment and to support UK businesses through better tailored offerings.

Adam Kelly, Managing Director, British Business Investments said:

• ^{Return to footnote location 1}

  ONS Data: Research and development expenditure by the UK government: 2022