The bond market could help smaller U.K. technology companies grow and develop their products, rather than being forced to sell themselves to larger overseas businesses, a panel of lawmakers said.
The government doesn’t have a strategy for helping scientists make successful businesses out of their innovations, Parliament’s Science and Technology Committee said in a report published in London today titled “Bridging the Valley of Death.” Pension funds no longer invest in risky business startups because of regulation, leading to a lack of sources of capital, the panel said.
The committee urged the government to use the Business Bank it’s currently setting up to promote a bond market for medium-sized companies.
“Equity investments have a place, but too many companies are forced into overreliance on this route because other types of funding are unavailable,” the committee’s chairman, Andrew Miller from the opposition Labour Party, said in an e-mailed statement. “British entrepreneurs are being badly let down by a lack of access to financial support and a system that often forces them to sell out to private-equity investors or larger foreign companies to get ideas off the ground.”