UK e-commerce minister affirms support for tech entrepreneurs

The minister wants UK tech companies to make more of public sector incubation funding available.

Douglas Alexander, the UK minister for e-commerce, has called on the UK’s £22bn software and services sector to make greater use of the venture capital funds available via the Department of Trade and Industry [DTI] .

Speaking at the UK Technology & Partnering Investment Forum, Mr Alexander highlighted research that shows 75 per cent of businesses that start in business incubation projects are still trading after five years, compared with only a third who start without such support.

The minister reminded hos audience that the DTI runs a number of business support schemes for the software and services sector. The Regional Venture Capital Fund is an England-wide programme of £199.5m that provides venture finance in amounts up to £500,000 to SMEs who 'demonstrate growth potential'.

The SMART Fund provides direct support of innovative companies and those seeking to better exploit technology. The £86m Phoenix Fund encourages IT entrepreneurship in disadvantaged areas.

'Due to its lack of reliance on geography, the software and services industry has the potential to make a positive impact in disadvantaged areas,” commented the e-commerce minister. “By embracing the support on offer, both new and established businesses will be able to spread prosperity and foster innovation.'

In addition, the £126m UK High Technology Fund was set up to encourage institutional investment in software and internet technologies. Of this, £114m has already been committed to specialist venture capital funds. These venture funds have to date in turn made investments in 69 start-up companies.