Technology and IT businesses can move from growth into financial difficulty faster than most sectors. Our Insolvency Practitioners are finding that the pressure on IT businesses is continuous as they must invest in new technology to keep pace with technological advancements, including AI-powered services. Our IT and technology expert, Kirstie Provan, shares the pre-insolvency advisory and immediate insolvency options available, or use our directory of licensed Insolvency Practitioners to find an IT and technology expert.
Software companies, IT services businesses, digital agencies, SaaS providers, and telecoms operators face a wide range of financial pressures, but what they share is exposure to rapid change. Client contracts can be lost to a competitor, a platform shift, or a procurement decision with very little warning, and the recurring revenue models that many technology businesses rely on can deteriorate quickly when customer turnover rises or a major contract renewal is lost.
Companies that have relied on loans or external investment to fund their growth can find themselves in serious difficulty when their credit application or funding round fails. We are finding that established IT services and telecoms businesses are facing margin pressure from increasing competition and the need for continuous investment in skills, infrastructure, and technology to remain relevant to clients.
Over the last five years, the number of AI companies in the UK has come to exceed 5,800 – an 85% increase since 2023, which shows increased competition and higher technological benchmarks. The majority of IT directors who speak with us claim that as more competitors integrate AI into their operations, they must follow suit or risk reduced demand.
According to Red Flag Alert data for Q1 2026, telecommunications and information technology businesses recorded 40,044 businesses in 'significant' financial distress and 3,426 in 'critical' financial distress.
In our experience, technology businesses often own assets that go beyond balance sheet entries; intellectual property, software licences, customer data, and ongoing SaaS contracts all require careful handling. A licensed Insolvency Practitioner with technology sector expertise will guide you through industry pressures and advise on the routes available.
An early review of your financial position, particularly relevant in view of a funding shortfall or key contract review. A licensed Insolvency Practitioner will assess what options remain open, including how to protect intellectual property, manage software licences, SaaS agreements, and customer contracts.
Company administration in technology is frequently used to facilitate a pre-pack sale of the business, preserving intellectual property, source code, customer contracts and staff, where those assets hold greater value as a going concern than in liquidation.
Practical intervention to stabilise a technology business under creditor pressure, addressing tax arrears, renegotiating terms with key suppliers and hosting providers, and reviewing the cost base, while protecting core products and teams.
Wind up an insolvent technology business in an orderly way. This involves realising the value of assets, including intellectual property, proprietary software, domain names and equipment, while addressing outstanding obligations to creditors, and dealing with prepaid customer contracts and subscriptions.
A CVA may suit technology businesses where recurring revenue from contracts or retainer agreements remains in place, providing the predictable income stream creditors require before approving a repayment plan.
A tax-efficient closure route for solvent technology businesses, where a founder is stepping back from a profitable company or removing a redundant subsidiary. The company must have no outstanding debts and sufficient assets to pay all creditors in full before an MVL can proceed.
A licensed Insolvency Practitioner with technology and IT expertise can navigate sector-specific pressures, such as intellectual property valuations, high volumes of consumer creditors, and contracts with insolvency clauses. An Insolvency Practitioner with knowledge of your sector can comprehensively assess the position of your company and advise on the best options to preserve value.
Restructure of a precision agriculture hardware and software company
Background: A TSX-listed company providing innovative hardware and software applications for precision agriculture worldwide required restructuring support. The company expanded beyond its core services, resulting in increasing operational inefficiencies and a severe resource shortfall.
Outcome: We initiated profit-focused corporate restructuring in collaboration with the board. This involved operational streamlining and strategic restructuring to restore the business to its core agricultural identity. The restructuring activity resulted in:
"We developed a detailed implementation plan that identified both non-core assets and divestment opportunities, while protecting the company's agricultural technology strengths. Our background considerations focused on maintaining key customer relationships and ensuring adequate working capital throughout the restructuring journey."
Whether you require pre-insolvency advisory services or immediate insolvency advice, we can connect you with a licensed Insolvency Practitioner with relevant sector expertise. Get in touch today for a free, confidential consultation.
We work with all types of technology and IT businesses, including software companies where intellectual property valuations add complexity to any formal procedure, SaaS providers with prepaid subscriptions, IT services businesses carrying contracts with insolvency termination clauses, digital agencies dependent on key people, and limited company IT contractors with overdrawn director’s loans.
Kirstie is a licensed Insolvency Practitioner with 15+ years of experience in complex global restructuring, distressed M&A, and financial advisory. She supports growing IT & technology businesses with operational streamlining, restructuring, and financing. Her expertise lies in sourcing and structuring asset-based finance transactions, helping IT businesses fuel strategic long-term growth.
Kirstie is a licensed Insolvency Practitioner with 15+ years of experience in complex global restructuring, distressed M&A, and financial advisory. She supports growing IT & technology businesses with operational streamlining, restructuring, and financing. Her expertise lies in sourcing and structuring asset-based finance transactions, helping IT businesses fuel strategic long-term growth.
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