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The British government is offering 1.25 billion pounds ($1.6 billion) to support technology start-ups during the novel coronavirus pandemic following calls from industry leaders and businesses for more financial backing.
The rescue plan, unveiled by Chancellor of the Exchequer Rishi Sunak on Monday, includes a 500-million-pound loan scheme, called the Future Fund, that will provide UK-based companies with between 125,000 pounds and five million pounds from the government, with private investors at least matching the government commitment.
A further 750 million pounds will be made available to support small and medium-sized businesses focusing on research and development.
Russ Shaw, founder of Tech London Advocates and Global Tech Advocates, welcomed the government's latest rescue package, saying it will help businesses grow and succeed.
Many new start-ups had not been able to access other government funding for small businesses as they are loss-making ventures, Shaw explained, and many organizations in the tech sector have been putting pressure on ministers to change that and boost start-ups.
"There's a real desire to help startups and scale-ups," Shaw said. "There's a real desire to come together and try and speak with a consistent voice and I think the announcement by the government is reflective of how the tech sector came together behind the 'Save our Start-up' campaign and secure funding it desperately needed."
He said that the UK government has shown an "important gesture "to the start-up ecosystem and tech sector by making sure "these businesses grow and thrive and not run out of cash".
"We have some very promising tech businesses like Monzo, Revolut and Funding Circle, but the businesses that will be hurt are the ones we are going to see emerge strongly in one to four years' time, so that's why this government funding is so important," Shaw said.
According to a Tech London Advocates survey, more than 50 percent of London tech businesses will be prioritizing survival in the next three months and 49 percent are anticipating that COVID-19 will threaten the viability of their business or employer.
Almost two in three cited cash flow and fall in demand as their businesses' greatest challenge.
Despite the challenges that lie ahead due to the pandemic, Tech London Advocates said many technology businesses are aware of their role in supporting society.
Around 75 percent of respondents agreed that tech companies have a more central role to play in the fight against COVID-19 through the development and use of AI, HealthTech and FinTech platforms.
"For example, there's Benevolent AI, an artificial intelligence business focused on reviewing and screening huge amount of data to help with drug creation," Shaw said. "Babylon Health are now playing a more significant role in terms of remote medicine and remote engagement featuring doctors and patients."
Tech London Advocates has also launched a resource hub to offer guidance and support for the UK's digital business and tech community.
Shaw said there is an advocate's directory to provide help and advice to not just the advocates community but "anybody who needs it during these challenging times".
An online portal will feature "TLA clinics" that will focus on various topics such as talent and recruitment advice and there will be a regular podcast offering expertise to tech companies.