Impact Of Coronavirus On Technology And Innovation

The Coronavirus pandemic has significantly impacted all industries; however, technology and innovation businesses are being earmarked as those that could emerge from the pandemic in a strong position.

Many technology and innovation businesses are in fact seeing the opportunities in the changing habits seen pre coronavirus being accelerated with the current pandemic. You can only look at the big players like Amazon, Microsoft, Zoom and Netflix that have gained a huge volume of new customers through this ‘technology fast track’ seen in the pandemic.

What we have noticed from our technology and innovation clients can be summarised as follows:

  • Increase in demand and opportunities for innovative solutions and technology to help working from home 

In the early stages of the pandemic this was seen as a short-term trend but as more businesses get used to working from home, employers are looking more to technology companies to streamline this as a permanent solution where working from home in some form becomes part of our weekly routine.

  • Accelerated adoption of technology 

We have seen many businesses increasingly using technology and innovation companies to better their processes and systems. This is partly to help processes run remotely but also businesses have now seen the importance technology plays in making them more efficient and experienced first-hand how reliable this can be. The adoption of technology has put innovation businesses at the forefront, as companies are looking to adopt new innovative products and systems to improve their business to weather the economic impact but also to become more agile in the way in which they provide their service or product to their clients.

  • Increase in IT fraud and cyber crime 

IT fraud and cyber-crime have been on the rise over the last few years, however, since the pandemic began, this has increased significantly, and businesses are at particular risk where they have employees working from home using their own devices with inadequate software protection. As a result, technology firms are now being depended on to ensure company networks are fully protected to avoid other disasters that would be unwelcome in the current economic climate. Ultimately, there is a significant focus on technology and innovation businesses to lead the economy into the truly digital age we are seeing as the new normal. Consequently, the government has responded to help these types of businesses get ahead:

  • Coronavirus Future Fund 

The governments coronavirus future fund provides convertible loans from £125,000 to £5 million to innovative UK companies. See here for the details – https://www.uk-futurefund.co.uk/s/

  • Research & Development tax credits 

Many innovation businesses have now fast tracked their R&D applications to claim back tax credits for qualifying projects. Our ‘tax guru’ Neill speaks about this here.

In addition to the government initiatives, many technology and innovation businesses are looking to corporate finance to raise funds for new projects and ideas they predict will be profitable in the next 18 months. Ultimately, these companies are looking to corporate finance to fund their growth and as a result, those angel investors and venture capitalists amongst us are regularly looking for the next project to invest in.

In summary, the growth in the technology and innovation sector can be seen as a real opportunity for many in a difficult economic climate, however, in response to the coronavirus pandemic, we have all become more reliant and dependant on technology and these companies are now looking to innovate and respond. It wouldn’t be a surprise that the UKs technology and innovation businesses thrive as a result of the Covid 19 hand that has been dealt and cement their place as the backbone of the UK economy in the post Brexit world we will find ourselves in, in the not so distant future.

Get in touch! Email Mehul by clicking here or alternatively give me a call on 020 8551 7200