3i to snub tech start-ups

Technology minnows' fortunes take a major hit as private equity giant announces that it will no longer invest in that sector

Private equity giants have turned their backs on the tech start-up companies, as the fledglings continue to be denied key tax breaks.

3i has now said that it will stop sinking cash into technology minnows, following the example of Apax Partners which stopped sinking cash into the sector last summer.

The BVCA, the venture capital industry group, is lobbying for tax benefits such as R&D tax credits to rejuvenate these businesses. 'The BVCA has for some time been calling for a range of measures to help foster a more successful venture capital industry in the UK,' BVCA chief executive Simon Walker told The Independent.

'These [companies] are currently denied access to a range of schemes available to other small businesses. This is a legislative anomaly and it would be easy to change.'

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