Australian company Radium Capital says it has seen a 161 per cent jump in the number of health and social care companies applying for advances over the past 12 months, with new inquiries from the sector accelerating in the wake of the COVID-19 pandemic.
The company, which was founded in 2017, specialises in R&D finance by providing tax advances for companies eligible for the federal government’s R&D tax incentive. It has provided funding of more than $327 million to over 153 businesses across 16 different sectors.
Radium Capital CEO Cameron Owens said before the COVID-19 pandemic advances were growing in popularity as health and social care sectors sought new ways to fund their R&D.
“Now advances have become a lifeline after traditional finance markets tanked amid coronavirus fears,” said Mr Owens.
“Not all healthcare and social care businesses claim the R&D tax incentive each year, and just a fraction have R&D advances on their radar to access their refund early. Now we’re seeing that change.”
Radium Capital said its advances have increased by 119 per cent over the past year. “The uptick in quarterly advances across the sectors we support is another new development,” continued Mr Owens.
“Quarterly advances are designed to provide consistent cash flow every quarter, rather than a single hit of capital.
“The quarterly advance model also makes R&D expenditure go further, because it triggers additional tax refunds.
“Some healthcare and social care companies are now viewing quarterly advances as a steady and longer-term capital option to help them through the months of uncertainty ahead.
“Before this health emergency struck, companies across these sectors were involved in vital R&D programs. We need to work together to keep the healthcare and social care sectors strong and position them for the recovery. We stand ready to act quickly and assist businesses experiencing a cash flow crisis,” added Mr Owens.