Australian Business Growth Fund to Invest in Small Businesses
The Federal Treasurer has announced the launch of the Australian Business Growth Fund (ABGF), which is targeted towards small and medium-sized businesses (SMEs) to assist with economic recovery following the downturn caused by COVID-19.
The ABGF will provide funding to SMEs with strong growth prospects which have owners and managers who are committed to growing the business. The funding will take the form of a minority equity interest in the share capital of the business.
The ABGF will be open to applications from SMEs seeking to obtain long term equity capital investments of between $5 million and $15 million.
SME applicants will need to have generated annual revenue of between $2 million and $100 million to be eligible to access funding from the ABGF. Applicants also will need to demonstrate three years of revenue growth and profitability and quality management. This revenue growth and profitability assessment however will take into consideration the detrimental impact of COVID-19 on recent business performance.
It is expected that the ABGF will be ready to start investing in SMEs in the first quarter of 2021, so there are no immediate actions to take. As more information becomes available, we will provide updates and details about the application process.
If you think your business may be eligible to access this funding, our team members are available to have this discussion with you.
The official Treasury announcement about the launch of the ABGF can be found here.
Date Published: 23 October 2020.