www.eismagazine.com JULY/AUGUST 2016 ISSUE 09
Investing for tomorrow
EIS
SEIS
VCT
SITR
IHT
BPR
IntroducIng PrIme InherItance tax ServIce
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IHT PORTFOLIO To learn more visit our website, follow us online or contact us: T: 0203 178 4055 E: info@prime-iht.co.uk W: www.prime-iht.co.uk
NOTE: This document is issued by Prestige Asset Distribution Limited, as financial promotion for information purposes only. It should be ignored by any UK recipients who are not either (i) authorised under the Financial Services & Markets Act 2000 (“FSMA”) or (ii) are investment professionals (within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (‘‘FPO’’), certified sophisticated investors (within article 50(1) of the FPO), persons of a kind described in article 49(2) of the FPO or certified high net worth individuals (within article 48(2) of the FPO). If you are in any doubt you should consult an independent financial advisor, who should be authorised under the Financial Services & Markets Act 2000 if you are in the UK. This financial promotion has been approved for the purposes of s21 FSMA by Prestige Asset Management Limited which is authorised and regulated in the UK by the Financial Conduct Authority (FCA). Your capital may be at risk and you may not get back the full amount invested. Tax treatment depends on the individual circumstances of each investor and may be subject to change. Past performance is not a reliable indicator of future results and any forecast is not a reliable indicator of future performance. The availability of tax reliefs also depends on the investee companies maintaining their qualifying status. The Prime IHT Portfolio invests into small unquoted companies which are not quoted on any stock exchange and which are likely to have higher volatility and liquidity risk than shares quoted on the London Stock Exchange Official List. First Equity Limited, Prestige Asset Distribution Limited, Prestige Asset Management Limited and Jarvis Investment Management Limited do not provide financial or tax advice on the Prime IHT Service and as this product is not suitable for everyone, investors should seek independent investment and tax advice from suitably qualified advisor(s) before making an application to invest in this product. Please note that all the information and figures in this document are correct as at 09/2015, unless otherwise noted. © 2016
CONTENTS 4. Editor’s Welcome 6. News EIS Magazine is published by
sily uld ea a ers co Advis er in this are trip ov paying heed t by no thoughts of t to the cial Conduc an the Fin ority (FCA) Auth
IFA Magazine Publications Limited, The Tobacco Factory, Loft 3, Bristol BS3 1TF Full subscription details and eligibility criteria are available at www.eismagazine.com ©2016. All rights reserved.
Telephone: +44 (0)117 9532 003 Editor-in-Chief: Michael Wilson editor@ifamagazine.com
City Editor: Neil Martin
12. Turning information into investment intelligence
Making the most of EIS, SEIS and VCTs means undertaking proper investment research, says Keith Hiscock
neil.martin@ifamagazine.com
Commissioning Editor: Michelle McGagh Publishing director: Alex Sullivan alex.sullivan@ifamagazine.com
Design: Fanatic Design www.fanaticdesign.co.uk EIS Magazine is for professional advisers only. Full subscription details and eligibility criteria are available at www.eismagazine.com EIS Magazine is a trademark of IFA Magazine Publications Limited. No part of this publication may be reproduced or stored in any printed or electronic retrieval system wihtout prior permission. All material has been carefully checked for accuracy, but no responsibility can be accepted for inaccuracies, independent research and where necesary legal advice should be sought before acting on any information contained in this publication.
14. Breaking records: EIS is a genuine growth story
16. Role of diversification in investor portfolios
18. Investing in life sciences: the
importance of sector experience HELPING THE
UK ECONOMY
SMALL
BUSINESSES
MAKING MORE
JOBS AVAILABLE
22. The growing attraction of smaller companies
Octopus Investments’ Paul Latham, explains why there are more ways than one to invest in small UK businesses
27. Open Offers
Our monthly listing of what’s currently available for subscription.
To stay up to date with the latest EIS news visit www.eismagazine.com
July/August 2016 · www.eismagazine.com
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Over the edge Political risk isn’t a subject that has needed to occupy the EIS and VCT market very much in the past. The government’s proposition has always been pretty straightforward: “if you’ll accept the risk for investing in fledgling and growing companies, then we and our successor governments, of whatever political stripe, will commit to honouring the tax-effective arrangements that you signed up to when you first took out your investments.” “Oh, sure, we might need to rein in the scope of what you’re doing from time to time. For instance, we stopped you last year from putting sustainable energy companies into any new EIS funds that you were planning, but we did let you keep the existing ones without modification. And the same thing applied when we changed the rules for VCT funds this year. We weren’t ever going to mess about with trying to renegotiate all our past commitments and understandings.” And a good thing too. Any mediumterm investment scheme that sets out to encourage high-risk investment needs to maintain that safety net under the people who want to use it. But the events of the last month have introduced a number of new and external risk factors that don’t have anything at all to do with changes in UK government policy. Shock and Awe in Europe The Brexit shock from 23rd June was as extreme as the uncertainty it created. The resulting upset in the financial markets actually frightened the continental European markets more than it did us – not least because the EU zone was terrified of Britain starting a wildfire that might engulf the continent. But, amid the recriminations, some of the Remain camp’s stated fears seemed to be coming true.
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EIS Magazine · July/August 2016
Sterling has plummeted, Moody’s and S&P have downgraded the rating of UK sovereign debt, and the truly nasty talk about cross-channel trade sanctions and tariffs have started to emerge. Worse, the Leavers seem to have no executive plan. What next? By the time you read this magazine we should have a better idea of what it all means – and the OMGI panel interview that you’ll find featured in this month’s IFA Magazine ought to shed further light. But for the moment I for one am not losing too much sleep. For one thing, the prospect of a weaker currency ought to strengthen the hands of smaller UK exporters against their foreign competitors. And for another, I really doubt that Germany will gain anything from tit-for-tat trade reprisals against London. More worrying for smaller companies would be the possibility that a weak currency could drive up input costs, or that the banks could rein in their lending to young companies. Cyclical and consumer discretionary industries such as housebuilding or pub management have been thumped. But the Bank of England has offered to pump in a quarter of a trillion pounds of new bank liquidity, which seems to suggest a reassuringly looser fiscal climate. Even the Chancellor’s threats of tax rises ought actually to enhance the attraction of tax efficient savings avenues such as EIS and VCT, if you think about it. But then again, perhaps a future Chancellor will decide to abandon austerity in favour of fiscal expansion, as our OMG panel expects?
Steady As She Goes We honestly don’t know. But between here and 2018 lies a choppy sea of recriminations, threats, resentments and downright protectionism from our European partners. I have faith that we’ll eventually get it all resolved, and that Brussels will find it expedient to cobble up some halfway-house agreement that keeps Britain linked to Europe even if it isn’t aligned in every way. For alternative investors, meanwhile, the advice needs to be to be to keep a steady hand on the tiller and a keen eye on the horizon. That, after all, is where we’re aiming for. The perilous straits and whirlpools between here and the far shore will still need to be negotiated, but that’s nothing we can’t achieve with patience and resilience. Mike Wilson Editor in Chief
A DIVERSITY OF GROWTH EIS / SEIS FUNDS – BROUGHT TO YOU BY INNVOTEC AND ITS STRATEGIC PARTNERS Anglo Scientific EIS This is Innvotec’s “flagship” Fund. This eighth annual EIS Fund from the Innvotec / Anglo Scientific collaboration is, by demand, now an “evergreen” fund that offers private investors all year round investment into fast emerging companies created and led by the well regarded, specialist and dedicated team of technology entrepreneurs, that is Anglo Scientific.
angloscientific
Anglo Scientific has built a portfolio, all EIS qualifying, of hugely promising companies, focused on delivering world class products based on the very best science, all of which should make a difference to peoples lives; investors have the opportunity to invest in a pre-identified portfolio of five or six of these companies, details of which are to be found in the Information Memorandum. C R E A TING SOLU TIONS
Performance across the earlier funds is impressive and is likely to remain so as the target companies are on a strong upward growth curve in both performance and value.
Startup Funding Club SEIS 2016 The third annual generalist SEIS Fund from the Innvotec / Startup Funding Club collaboration, the first two having been deployed across well-diversified portfolios, with forty companies having been invested in. Startup Funding Club is one of the most successful “boutiques” working with companies seeking seed and early-stage finance, especially those companies that own proprietary intellectual property (IP) capable of being exploited globally and whose founders possess the stamina and know-how to meet the challenges that lie ahead. The Startup Funding Club’s network ensures that opportunities are sourced from many of the UK’s best regarded “incubators and accelerators”. Whilst the portfolio will have a technology-bias, it will also include product based companies and those in the food sector. Integral to the success of the Fund is a mentoring programme in support of the entrepreneurs and a co-investment policy that sees the Fund investing alongside business angels.
Odyssey Mission SEIS UK based private investors have an opportunity to invest in the Odyssey Mission SEIS Fund, a novel portfolio of early stage businesses led by Asian Entrepreneurs. Investors have the prospect of strong capital appreciation whilst helping an “affinity group” renowned for both ability and commitment. The Fund is focused on providing start-up /early stage funding and mentoring support to the best of the next generation of Asian graduate entrepreneurs that wish to build their businesses in the entrepreneurial-friendly United Kingdom, some of whom will require a Tier 1 graduate entrepreneur visa so to do. The SEIS Fund is the first step in the Innvotec / Startup Funding Club inspired Odyssey Mission project to encourage cross fertilization of entrepreneurism between the UK and the Indian sub-continent.
OION SEIS 2016 The OION SEIS Fund is the second Innvotec managed growth fund in association with Oxford Innovation Opportunities Network (OION). The Fund offers private investors an opportunity to invest in a growth portfolio of early stage businesses identified by OION through its UK wide affiliated network of business and innovation centres and its associated business angel networks. The companies that will form the OION SEIS Fund will be from across the UK and will use the proceeds of investment to advance them on their business growth curve. The Fund benefits from the participation of Oxford Investment Opportunities Network (OION) in generating quality deal flow and as with all Innvotec managed SEIS Funds the entrepreneurs will be supported by the provision of experienced mentors.
FinTech SEIS 2016 Another fund from the Innvotec/ Startup Funding Club association, with FinTech Circle as the provider of sector expertise, and the first dedicated to investment in aspiring UK companies operating in the financial technology sector. The global financial services industry is currently experiencing a wave of innovation which is starting to shake up decades of status quo. A large number of “newcomers” are developing products and services that are disrupting traditional activities such as foreign exchange, payments, asset management, insurance and even developing new forms of currencies. Companies within the FinTech SEIS Fund will benefit from the complimentary knowledge and expertise of the parties involved.
“And other funds to follow” For full details on any of the above EIS / SEIS Funds or any other information please contact Innvotec on:
Tel: +44 (0) 20 7630 6990
Email: info@innvotec.co.uk
Web: www.innvotec.co.uk
Issued and approved by Innvotec Limited, Business Design Centre, Suite 310, 52 Upper Street, Islington, London, N1 0QH. Innvotec Limited is a registered company in England & Wales. Registration Number: 2030086 Innvotec Limited is Authorised and regulated by the Financial Conduct Authority.
VA0815
News Round up of the latest industry news Green shoots goes north Green Shoots, the young professionals network within The Enterprise Investment Scheme Association (EISA), has launched a North of England branch. Called Green Shoots North, it’s open to young entrepreneurs and professionals working in the small and medium-sized (SME) funding sector in the burgeoning ‘Northern Powerhouse’. The branch aims to provide a forum for members to network, build business relationships and enhance their knowledge of the alternative finance sector through regularly held formal and informal events across the region. The aim is to build on the EISA’s links to the region following a series of technical seminars in Manchester, Liverpool and Sheffield over the last few years.
The Green Shoots network was established by former EISA Director General Sarah Wadham in 2015. Speaking at a Green Shoots North launch event held at Veeno, in Manchester, on May 26th, she said: “There is a real sense of entrepreneurialism and innovation in cities such as Manchester, Leeds, Liverpool and Sheffield, as well as in many others. We hope that the launch of Green Shoots North will contribute to that buzz and is a sign of the momentum behind the Northern Powerhouse. “The North of England accounts for a substantial proportion of financing for SMEs through EIS, which reached a new record of almost £1.7bn in 2014/15. We expect that to increase as the ‘Northern Powerhouse’ concept brings new investment into the region, sees improvements to transport and infrastructure, and more businesses choose to start up and grow here.” Founding committee member of Green Shoots North Patrick Molyneux, of corporate finance company Acceleris Capital, said: “There is real demand for a dedicated network for young professionals in our industry based in the North. Establishing Green Shoots
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North was the natural answer to this need. We’re really pleased by the response of individuals and companies to its launch and particular thanks goes to DWF and CLB Coopers for their sponsorship of our inaugural event. “We had almost double the numbers we initially anticipated on the night, which indicates the thriving nature of the SME funding sector in the North, and we’re looking forward to our next event and getting to know more industry colleagues and entrepreneurs.”
Mariana EPS looking to invest in Anaerobic Digestion The Mariana Estate Planning Solution (Mariana EPS) is looking to invest in a separately operating BPR qualifying company whose primary trade is anaerobic digestion (AD). Mariana EPS is an evergreen BPR portfolio service managed by Enterprise Investment Partners LLP with Mariana Capital Markets LLP as the investment adviser. It is designed to be an investment which, if held for at least two years and at the time of death, can be used to shelter part of an individual’s estate from Inheritance Tax. What’s more, the service is run under a strict capital preservation mandate.
Mariana has now partnered with a major subsidiary of a FTSE 100 company – the company has been in business for over 100 years and are the world’s second largest producer of sugar. A statement from Mariana said: “This company wish to strengthen the relationship with its farming supply chain, through the delivery of a program of farm-based AD plants. In return for a fully funded solution, this company will help to operationally derisk the project via the provision of deal flow, robust feedstock and maintenance contracts and long-term operational supervision. “The Mariana EPS includes an ‘Enhanced Liquidity’ feature whereby Mariana will purchase the shares from an investor who needs to exit quickly. Monthly and quarterly liquidity windows are available.”
It’s back: the seed and EIS hour returns The Seed and EIS Hour, produced by Intelligent Crowd TV, begins its third season on May 16, 2016. Launched first in 2015, it is the world’s first series dedicated to seed-stage funding by Crowd, Angel, Private Equity, Family Office and Corporate Venturing investors. The focus is on curated, harder-to-explain B2B investment opportunities and streams. It goes out live at 8pm every Mondays to PCs, smartphones and tablets. The programme is based around two companies being selected for interview, together with two guests from the industry discuss topical or educational issues such as understanding the tax benefits; building an early-stage company portfolio; or identifying and valuing great earlystage businesses. What’s more, the audience hears a commentary on the companies showcased each week, from Argus Research. They can also join the program via Skype, allowing them to put questions directly to the entrepreneurs. Importantly, during, or after each program, the audience can register their interest in particular companies – in order to be first in line when the company starts to raise funds. CEO Shane Smith commented: “The Seed & EIS Hour is proud to have played a part in the fundraising journeys of fifteen of the companies showcased in Seasons 1 & 2, and we’re looking forward to interviewing a new portfolio of exciting early-stage companies in the coming series.
“Typically the companies that we select to showcase have more sophisticated business models or products than average but, in our view, offer superior investment prospects – particularly as part of the diversified and balanced portfolio approach that we advocate. The Seed & EIS Hour provides an opportunity for our brightest young companies to explain themselves to potential investors – and provides our audience with an efficient and powerful tool to find and evaluate the leading companies of the future.” You can watch the first episode of The Seed and EIS Hour on Monday 16th May at 8pm here – www. intelligentcrowd.tv
Record level of funding received by SMEs and growth companies Acting Director General of the EIS Association (EISA) John Glencross comments on the record level of funding received by SMEs and growth companies through the Enterprise Investment Scheme (EIS): “The amount raised by companies seeking funding through Enterprise Investment Schemes (EIS) reached a record high in 2014/15 of close to £1.7bn, according to new HMRC data. And the number of companies receiving funding has continued its recent trend of annual growth, reaching 3,130 in 2014/15, its second highest to date, up from some 2,800 in 2013-14 and closing in on the record 3,300 companies that received EIS funding at the height of the dot com boom in 2000/01. “These impressive figures confirm that EIS is a vitally important part of the company funding cycle that is enabling thousands of smaller companies to take the next step in their development with the help of financing provided by the British investing public. “Since EIS was created in 1993/94, almost 25,000 businesses have received more than £14bn of funding from the scheme, which is a great testament to its success. EIS undoubtedly forms part of the bedrock of the growth company funding landscape, helping businesses to grow and succeed, which in turns pays dividends to the wider economy through job growth, taxes, spending and new products and treatments. Finally, in a virtuous circle, the UK
taxpayers who back EIS companies and funds are rewarded with generous tax reliefs and, often, attractive tax free investment returns. “In terms of the EIS regime itself, while some of the recent changes to EIS are appropriate, such as the ending of EIS tax relief for energy generation projects, we need to ensure that EIS continues to effectively address the acknowledged equity gap for smaller companies, including both early stage and those requiring scale-up capital. It is therefore incumbent on policymakers to continue to work closely with the industry to ensure the ongoing effectiveness of EIS for these purposes.” For full details of the latest EIS and SEIS fundraising data, follow this to the HMRC website – https://www.gov.uk/ government/uploads/system/uploads/attachment_data/ file/390876/Commentary_EIS_SEIS_Dec_14_V3.pdf
July/August 2016 · www.eismagazine.com
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Mission to revive the high street
New director general of EISA
PocketHighStreet, backed by SeedEIS Platform, is on a mission to revive the high street. The company has joined forces with a growing army of businesses on a shared mission to halt the decline of the high street. This comes in the wake of both BHS and Austin Reed collapsing into administration. PocketHighStreet sets out to promote local shops and everything they have in stock on the day across London’s most popular online newspapers, city guides, business directories, blogs, mobile apps, social influencers and marketplaces. Products in stock in local shops are registered with pockethighstreet.com
Mark Brownridge is the new Director General of The Enterprise Investment Scheme Association (EISA). Brownridge starts on 1st August and moves from Mazars Financial Planning where he is Head of Research and Development. He has more than 20 years’ experience in financial services. He is a Fellow of the Personal Finance Society, a Chartered Financial Planner and a Certified Financial Planner. Brownridge said: “In my eyes, the Enterprise Investment Scheme and the Seed Enterprise Investment Scheme stand out in the investment landscape. They help small companies attract the investment they need to grow and succeed, they help our economy by creating jobs and driving growth and they provide investors with attractive tax incentives. “That’s why I am delighted to be taking on the role of Director General and I look forward to leading EISA into a new and exciting phase at a time when the sector is attracting investment at record levels. “I am committed to reaching out to a broad range of audiences, including financial advisers and other professionals, to make sure they are fully aware of the benefits offered by EIS and SEIS investments.” He replaces John Glencross, Chief Executive of Calculus Capital, who has been Acting Director General of EISA since Sarah Wadham stood down as Director General at the end of March. Glencross said: “Mark combines a first-class financial services pedigree with enormous drive and energy. These are exactly the qualities needed to continue to increase the influence of EISA among our key audiences and stakeholders.”
and will be available for one hour delivery, or ‘click & collect’ in minutes. They will be discoverable across a wide range of digital publishers. All local shops and digital publishers can register for free and join the movement at pockethighstreet.com. Dan Rodwell, Managing Director of SeedEIS Platform, which provides access to tax efficient investment opportunities for professional investors and intermediaries, and invests in PocketHighStreet, said: “Many of the investee businesses on the SeedEIS Platform are successful for their ability to be innovative and forward thinking. PocketHighStreet, is jumping into action in the wake of this big news on the High Street.” CEO at PocketHighStreet Alex Schlagman said: “We’re in the middle of the most transformational period in the history of retail. For local shops to stay competitive in the connected digital age, we need to empower every local shopkeeper and put the digital high street at everyone’s fingertips. “Shopping has changed forever. When I see something I want online it’s sourced via my local high streets and in my hands in minutes.”
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IW Capital is a private equity house focused on structuring and leading tax efficient investment opportunities on behalf of our investors. We are sector agnostic and focus on tax efficient Enterprise Investment Scheme (EIS) investment opportunities of between £1 million and £2.5 million. We professionally manage the whole process on behalf of investors, from the opportunity, right through to post deal management and eventual exit. We provide investors with regular reports on the investee companies and take an active role in managing the investors’ interests. Above all, we take pride in forging strong working relationships with the companies and investors from the outset. Address: IW Capital Ltd, 42 Bruton Place, London, W1J 6PA Telephone: +44(0)20 7015 2250 Email: info@iwcapital.co.uk
IWCapital’s Capital: 64% of UK’s serious IW Summary of investors look to EIS for 2016/17 Taxpayer Sentiment Report Financial Year
IW Capital finds that 64% of UK’s Serious Investors IW Capital regularly surveys UK investors to examine how their financial plans are evolving Look to EIS for the 2016/17 Financial Year and to understand how it can help them to effectively execute their investment strategies. Our most recent piece of research, the Taxpayer Sentiment Report 2016, revealed: Research by IW Capital has revealed that a growing investors are looking to EIS as part of the 2016 tax year. With the recent Government reforms to the Capital Gains tax, our Taxpayer Sentiment ³ 54% of UK taxpayers with an investment value over £40,000 would consider investing Report 2016 revealed the following: through EIS for the 2016/17 financial year; •
34% of investors would with more than £100,000 in investments would invest in SMEs but don’t ³ Of those who intend to invest between £100,001 and £250,000, 64% would consider have the knowledge to do so using the EIS over the next 10 years;
•
Of those who intent to invest between £100,001 and £250,000, 64% would consider using the EIS ³ 34% of UK investors with over £100,000 worth of investments would invest in SMEs, but do not know how to. 54% of UK taxpayers with an investment value over £40,000 would consider investing through EIS for the 2016/17 financial year IW Capital enables investors to take advantage of the growth potential of the UK’s SMEs.
•
RecentWe Investment Opportunities Offers Have Completed
BorrowMyDoggy Limited (BMD) is a WeSwap.com Limited is a company young, innovative business with a unique revolutionising traditional lending practices offering, connecting dog owners with local through a product dedicated to the travel borrowers across the UK and Ireland for money market. Based in North London, dog walks, sitting and holidays. BMD has WeSwap was established in 2011 and BorrowMyDoggy Limited is a young, innovative business a unique offering, connecting dogs created a trusted community of almost haswith created and launched a Peer to Peer owners with local borrowers the for dog walks, sitting and holidays. 400,000 members and isacross a leader inUK theand Ireland Currency Exchange service; allowing The users company was launched two years go, and has already had bookings totalling £1m+, having created UK sharing economy. to swap and exchange currency with other a trusted community of almost 300k members. The company operates users of the site. a membership based business model, and was recently hand-picked to be part of the “Scale Up Club” by SVC2UK, as a company that could hit £100m in revenue in the next three to five years.
Turning information into investment intelligence Making the most of EIS, SEIS and VCTs means undertaking proper investment research, says Keith Hiscock, Chief Executive of research and capital markets consultancy Hardman & Co Being well informed in EIS, SEIS and VCTs is set to become increasingly critical to IFAs. As the lifetime pension cap has been systematically reduced over time to only £1 million now, these products are no longer the preserve of the wealthy. However, it is a daunting prospect for an adviser to develop expertise in a new investment area, especially one deemed higher risk and where working out which of these products is suitable, or unsuitable, for clients can be difficult. This could put professionals at risk as they may require documentary evidence recording their justification for investment advice. Furthermore, many IFAs, discretionary fund managers and compliance departments may be inexperienced in this area. What is also becoming clear is that advisers could easily trip over in this area by not paying heed to the thoughts of the Financial Conduct Authority (FCA). In a paper published in February (TR16/1: Assessing suitability: Research and due diligence of products and services), the regulatory body found that many advisory firms “demonstrated inconsistent and insufficient research” and that the poor quality of research and due diligence is a root cause of sub-standard results for consumers. Having probed 13 advisory firms, the regulator was unhappy with what it found, ordering three to make improvements in their due diligence and one to carry out an in-depth past-business review. Research that ignores risk, charging structures and investment process will not be good enough. Regulators are taking an increasingly dim view of advisers
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who understand the tax breaks but not the investment risks and rewards of tax-efficient products. There is a serious caveat concerning research, however.
Quality of intelligence over quantity of data In the information age, the availability of data can be a curse as much as a blessing. Many DIY investors have been seduced by the availability of information only to have their fingers burned after having either misinterpreted it or lent too much credence to poor-quality or incomplete reporting. In the world of tax-efficient investment, financial advisers, discretionary fund managers, compliance departments and sophisticated investors may struggle to find high-quality research making measurement of risk and reward more problematic. EIS, SEIS and VCT products can carry a higher-than-average degree of risk and with greater risk comes an increased reliance on research. That said, even using a research consultancy is no panacea, given that not all are FCA regulated.
Raw information is not enough For sophisticated private investors and their advisers, it is not raw information that allows them to effectively analyse risk and reward but intelligence. Providing information is easy. It requires deep-rooted expertise to turn the base metal of information into investment knowledge gold. Is it still enough to look at strategy, experience and depth of the management team, investment process, track record, costs, sector specialisation, quality and sources of
deal flow and governance? In this new era of popularity for EIS, SEIS and VCT investment vehicles, professionals also need to consider conflicts of interest that could damage a portfolio, how performance fees are calculated and levels of oversight. Not only will they have to comprehend these additional issues, they will also need first-class evidence of this extra due diligence in language that is concise and unambiguous. This can be a big ask in a complex area where the requisite breadth of knowledge is not always readily available to non-specialists.
A safety net for advisers High-quality research is essential to justifying investment decisions and is a vital safety net for advisers. Though risk management is a key compliance consideration, for want of accurate and intelligent research, great investment opportunities may be overlooked. The UK has an impressive track record when it comes to innovation but is less adept at recognising and realising its potential. The growth of EIS, SEIS and VCT investment products can help fulfil this promise but only if advisers have the research to assess risk by getting the right information from the right source at the right time. Unfortunately, they do not always access the right research and due diligence. For its part, the FCA has recognised this predicament and is poised to act. The ability to distil raw data into investment intelligence has therefore never been more crucial to investors, advisory firms and the EIS, SEIS and VCT sectors.
Investors and advisers need to be more discerning It is telling that the increasing complexity of this sector means that we are being asked to provide more independent reviews of tax-efficient products. We have also noticed a growing appetite for investment training as more IFAs recognise the need to be educated about the investment proposition.
Speaking to the FT this year, Bill Gates argued that investors need to be more discerning. The only way to achieve this is to access better research. Many sophisticated investors suitable for EIS, SEIS and VCTs will, like Bill Gates, be successful entrepreneurs who want to invest in innovative businesses, having a greater appetite for risk than the average investor.
With more than 35 years’ City experience, Keith has long-standing relationships with major institutional investors, private client brokers and wealth managers. After reading philosophy, politics and economics at Oxford, he began his career at James Capel in 1979, then considered London’s highest-rated research house. He was a founding member of Schroder Securities and of Agency Partners, a
They tend to be bright people who have a keen understanding of the importance of accurate in-depth research as an intelligent means to limit risk and maximise potential returns. They understand that a strong investment rationale is also vital to demonstrate that decisions are not primarily driven by tax concerns.
leading research boutique. He was also a member of the 5 man securities board at Evolution. In 2012 he was part of the investment consortium that acquired Hardman & Co. Regulated by the FCA, the firm has extensive experience of producing independent reviews of quoted companies, providing independent research and offering capital markets advice on a range of businesses.
ily ld eas a u o c s er re Advis er in this a d trip ov paying hee f t by no thoughts o c t to the cial Condu ) nan the Fi horit y (FCA t Au
July/August 2016 ¡ www.eismagazine.com
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Breaking records: EIS is a genuine growth story Ian Battersby, Business Development Director at Seneca Partners, looks at why EIS is becoming more popular, but says good opportunities will be harder to come by Figures from HMRC show over 24,500 companies have received investment through the Enterprise Investment Scheme since its inception – raising over £14 billion. Year on year growth in amounts raised under EIS shows no sign of abating and with pension rule changes taking effect in this new tax year, EIS is assuming mainstream importance in the planning process for both advisers and investors alike. Against this backdrop the 2016/17 tax year could see record amounts looking for an investment home. It certainly seems the case that more people are finding that EIS has a part to play in their wider wealth management and estate planning needs. However, what has become abundantly clear, as a result of recent legislative changes is that the inherent tax advantages which are available under EIS will not fit every risk appetite and suitability and appropriateness should never be compromised purely because of the tax breaks. The government are committed to ensuring that tax reliefs are used in a well targeted manner aimed at providing much needed capital to growing businesses who may otherwise struggle to access funding from more traditional sources. Within this definition therefore, it is no surprise that ‘renewables’ is no longer EIS qualifying which is historically where large swathes of cash were being invested on the basis that tax
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EIS Magazine · July/August 2016
reliefs could be obtained for limited risk. Those days are over. The EIS landscape has undergone significant change and it follows that the tax reliefs are being made available in recognition of the increased risks associated with investing in generally younger, growing companies. This presents a very different risk profile but one that can be very compelling in appropriate circumstances. Focused on growth In coming to terms with the fact that EIS cannot be viewed as a tax mitigation tool for high earners, the government looks to be committed, for the foreseeable future, to providing tax incentives for investors who have the appetite to invest in British SMEs, and who in the engine room of the economy can help to fuel growth and create employment thus achieving an all-round benefit for all UK taxpayers. Whilst that may disappoint some investors, there can be little argument with HMRC’s stance on this which is eminently fair and reasonable.
Changing landscape So with renewables no longer in the equation, and the recently announced withdrawal of the largest EIS promoter from the market, what can we expect to happen? Rule changes apart, operating a growth capital strategy is a wholly different beast to the more capital preservation type strategies and selecting a manager with the necessary skillsets and capability in a growth capital context will be a major issues for advisers to contemplate. Deploying tens and in some cases, hundreds of millions in growth cap situations simply won’t happen. The seven year rule probably gives some indication of the size and scale of each investment opportunity with metrics dictating that most deals are likely to be sub £2 million. That represents a very substantial number of deals for the market to absorb if the numbers heading towards EIS are to be believed. Seneca have been specialist operators in the SME market for many years and to complete the requisite number of deals, at the right values and get through the necessary levels of due diligence is not to be underestimated. This will undoubtedly catch out the lesser experienced operators in the market as will pressure to transact at over inflated valuations. It will be interesting to see in the coming years how exit track records shape up because when all is said and done, that is the only real success
measure for investors. Investing now and obtaining the upfront tax reliefs might appear to be ‘job done’ in some quarters but if the underlying investments are poorly conceived then the unwanted and uncomfortable conversations between advisers and their clients will be inevitable three or four years down the line. Hitting the wall So on the one hand the attraction of EIS amidst all the other changes, could potentially see even higher demand this year, yet on the other we could be looking at a much smaller universe of good quality opportunities for the market to invest into. The key for advisers therefore will be to research their chosen providers very carefully and satisfy themselves that the managers they choose have strong pedigree in a growth cap context. Historic strength in renewables will not automatically passport into growth cap capability, far from it. In this regard, a good quality, ongoing deal flow pipeline will also be an essential consideration. Our view, is that EIS is, first and foremost, an investment led proposition. We feel there is merit in having an exposure to this asset class within a portfolio as a non-correlated investment. So each investment we make, has to pass the acid test of standing up on its own investment case. The tax benefits are secondary but at the same time very compelling if the underlying investment is doing its job. For this reason, hoovering up
huge amounts of capital from investors and throwing it at sub-standard deals purely to attract the tax reliefs is a complete non-starter. Equally, our charging structure seeks to align with investors’ interests such that our remuneration derives from successful investment outcomes. The recommendation to advisers is therefore to invest continuously throughout the year rather than
waiting until Q1 because good quality deals may not always be easy to come by in a dash for the tax year end. To be fair, a growing number have recognised that investing now for example should see tax certificates coming through in time for 31 January in any event. So that in its own right is a driver for some investors. We see over 500 opportunities each year and typically we will only transact in 20-30 which might give some indication of the deal selection process and the challenges of finding deals of appropriate quality and at the correct value. It is a point I can’t over emphasise and advisers need to be aware of the impact on the market this year.
Watching this space So in essence, this is likely to be a very interesting year as the market settles into the changes and it will be interesting for advisers to take a view of the market and assess how and where they plan to accommodate their clients. Indeed clients themselves may need to adjust to the changes as their journey from low risk capital preservation necessarily takes them up the curve to growth capital. But whatever the outcomes are, there can be little doubt that when used appropriately, EIS is becoming an increasingly potent weapon in the armoury of an increasing number of adviser firms.
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Role of diversification in investor portfolios Those investing in alternative investments may be risk-takers by nature but diversification is still key, says Tom Bradley, Partner and Head of the growth investment team at Oxford Capital. In finance, diversification is the process of allocating capital to a portfolio in a way that reduces the exposure to any one particular asset or risk. A common path towards diversification is to reduce risk or volatility by investing in a variety of assets. Investors in venture capital are by definition risk seekers and venture capital investments represent a way for investors to get exposure to a higher-risk, higher-return position on the spectrum for a part of their portfolio. To say that venture capital investments are more risky is not the same as saying that risk cannot be managed in venture capital portfolios, and diversification plays a critical role in risk management. There are a number of ways in which diversification can be achieved in venture capital portfolios. Safety in numbers The simplest way to diversify risk is to ensure that total portfolio investment is spread across a reasonable number of underlying companies. This diversification clearly insures to some extent against the specific risk of individual companies failing. It does not follow however that more is better. In constructing portfolios for Oxford Capital’s investors, we seek to spread investments across around 10 underlying companies. Sometimes it is slightly more and sometimes slightly fewer, but our view is that this is the optimal portfolio size. Balancing duration Diversification is not just a function of numbers. Within a portfolio, it is also possible to create balance by investing in companies that are at different stages of development. Most of our
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origination activity is geared around identifying the strongest emerging technology companies in the UK at the early stages of their development. It is possible to achieve another level of diversification in portfolios by blending new deals (the best early stage investment opportunities) with further investments in portfolio companies (the best later stage opportunities). Diversification by stage is designed to offer a range of investment durations and ensure that cash starts flowing back to investors in a reasonable number of years. End user markets
Customer bases can form a further component of diversification. The identity and profile of the customers (that is to say the revenue engine) of a business is a risk that can be diversified away. For example, a portfolio with excessive concentration of customer risk on UK consumer spending is not well balanced. Similarly, a portfolio with several companies selling long-term contracts to government departments is poorly balanced. A portfolio of companies selling to different end-users can limit the risk of isolated shocks in certain areas of the technology market or the wider economy.
Business model As well as targeting different end users, investors’ interests are well served by investing in a variety of business models. As an example here, one of the sectors in which Oxford Capital invests is Software-as-a-Service (commonly known as SaaS). SaaS business models can be very attractive because contracts are long term and typically paid for on a recurring basis. This gives a SaaS company a relatively high degree of visibility on future revenues because the bulk of turnover
come from existing contracts. This contrasts strongly with the perpetual licence model of software sales (where customers secure perpetual access to a product for a larger upfront fee), where growth requires more and more selling in each period. Because of their attractive nature public SaaS companies have attracted high valuations, but the optimism around these valuations became detached from reality. Consequently public SaaS valuations have declined substantially over the last two years and precipitously over the last two quarters. If we held a portfolio of only SaaS companies, our valuation comparables would have decreased by 57% over the last two years. With only 10% of a portfolio in SaaS companies, we have exposure to this business model, which we believe is attractive in the long-term, but the impact is proportionally less.
Geographies and exchange rate EIS investing naturally constrains the investor to acquiring shares in companies with a significant UK presence. But there is still an opportunity to introduce a form geographical diversification into an EIS portfolio, by investing in businesses that have the potential to sell their products or services in overseas markets. We try to identify companies operating in sectors where the UK has clear comparative advantage and hence the possibility of producing global leaders. It is important to us that our companies address multiple markets and segments to provide some resilience against localized economic slowdown or other specific factors. This may also give us some diversification in terms of currency. Not only does an international business appear more attractive to
potential acquirers, but also a portfolio of UK companies, selling only to UK customers with an all sterling cost base is more vulnerable to exchange rate fluctuations than one where there is a diversified range of customers and possibly operations.
Indicators of value growth Different types of company will have different indicators of value growth. A drug discovery business may see a very significant value uplift when one of its drugs moves through Phase 2 clinical trials. A company at this stage may still be pre-revenue but the potential of the drug could be so great as to afford the company a very high valuation. At the other end of the spectrum an eCommerce business will not increase in value without firstly sales growth and latterly, maturing profitability. It is our goal to have companies that exhibit value growth in different ways. We see this as something of a hedge in terms of investment duration in the portfolio and a means of being able to have portfolio successes at different points of the cycle. Embedded in the concept of seeking a variety of value indicators is the idea that we are seeking businesses with what some call ‘strategic value’. Our goal is that the businesses that we back will typically not be valued at the discounted value of their future cash flows but at a premium for their disruptive potential. Co-investors We operate a strategy of syndication. That is to say, wherever possible, we like to work
with high-quality co-investors in our portfolio companies. We think that careful syndication gives portfolio companies better access to capital, to network and to expertise. Importantly, it also provides us with another level of diversification. Working with partners means that we share the rewards but also we share the burden of financing needs. Working with different partners in different deals means that we do not concentrate our risk on a single partner.
Closing thoughts It is also worth saying that investors in venture capital funds should seek diversification over time. Investing in a single annual vintage is inherently more risky than investing steadily over several. We work exhaustively to try to deliver consistent performance but it is inevitable that certain vintages will perform better than others. The best way to diversify away this timing risk is to invest across a number of years. Although risk can be managed through diversification, it is also important to focus on execution capability and business quality as primary factors in investment decision making. Our belief is that risk cannot be entirely diversified away in a venture portfolio. Nor is it desirable to try. It is our belief that a successful venture capital strategy requires an investor, over time, to skew portfolio weight towards the best performing positions. Those that perform best should receive the most capital and over time. A well-constructed portfolio will have enough of these high performing companies such that the benefits of diversification should not be lost as the portfolio matures.
July/August 2016 ¡ www.eismagazine.com
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Investing in life sciences: the importance of sector experience Life science is an appealing sector for investors but it can also be a challenging area to understand, says Dr Savvas Neophytou, Head of Life Sciences at Deepbridge Capital. When investing in small unlisted companies, it can be advantageous to work with investment managers that have specific sector experience. Not only does this ensure that the manager understands the language and concepts involved with potential investments, but more fundamentally ensures a better chance of delivering real returns to the investor. The life sciences sector, and by that we mean biopharmaceuticals, biotechnology, medical technology, pharmaceutical research and anything where folk in white jackets are seeking to cure, prevent or ease the symptoms of a medical condition, is a particular sector where experience can be vital to the success of an investment. Investments in life sciences can be appealing to many investors. They might be experienced in the medical sector themselves and have a personal interest. They may wish to invest in life sciences from a moral perspective and wish to support such projects. In addition to those with knowledge of the sector, it is evident that there is interest in biotechnology from the likes of high-profile professional sports people. Arsenal and France international footballer Mathieu Flamini is an example of one such individual who has invested in this sector. Not only does it benefit their tax affairs but it also provides a good moral ‘hedge’ against public opinion on tax management. In fact, one financial adviser suggested to me that by investing via a government
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EIS Magazine · July/August 2016
initiative such as SEIS and investing in potential cures for serious illness such high-profile individuals could be able to ‘Daily Mail-proof’ themselves. We found this to be an interesting angle but suggest this highlights why sector experience at the investment manager level is additionally important as many investors will not have personal sector knowledge.
It is important that the investment manager has the capacity to be able to understand and interact with the academic voice
Due diligence Due diligence, particularly of very early stage companies, in the life sciences sector will often involve a theory or idea based on practical observations. Understandably, many individuals in this sector are academics and may have little previous commercial experience. They may have never before written a business plan or outlined financial projections. Company valuations and the broader equity journey may be completely alien and creating documentation to attract finances may be a new concept. There are of course many extremely commercially-proficient individuals but there are also those who are not, so it is important that the investment manager has the capacity to be able to understand and interact with the academic voice. Without this ability, the manager may miss potentially
great opportunities purely because the commercial documentation being reviewed lacks commercial clarity. Similarly, an investor could be biased towards a fantastic proposition from the more financially polished companies and be enticed to invest in propositions which are scientifically inferior but better marketed. Only by understanding the sector, the language and the concepts can a manager undertake accurate due diligence on such companies, particularly early stage companies. For example, for a drug to be commercially successful, it must demonstrate clear clinical superiority against the standard of care either in absolute terms or in costefficiency terms.
Understanding the commercials The commercials of a life sciences company can be vastly different to that of a generalist venture capital investment. Generally speaking, general VC rules would show the venture capitalist analysing a potential investment based on current revenues, projected revenues and projected costs, thereby offering EBITDA projections. The VC may then use a standard EBITDA multiple calculation to justify future valuation and potential exit price. This tends to work for most VCs and is an established format. However, in the life sciences sector there are often factors that go against these standard principals. For example, some companies may never realise a profit or may never generate commercial revenue prior to an exit.
This is likely to be research focused organisations which initially generate income from grant funding and then specialist investment. Due to the research being very specific it may only be when the research has reached ‘Phase 3’ trials that it then has a potential commercial value to be acquired by ‘Big Pharma’. Only by understanding the stages of development and trials, and by understanding this niche commercialisation process, can an investment manager assess the potential commercials of a deal.
Ability to price risk A typical life sciences company may have to initially start with not inconsiderable research which is then followed by various product iterations before multiple clinical trials.
Recognising at which point to invest in this commercialisation journey can have a direct bearing on the potential returns for an investor. This may vary from company to company dependant on various factors including the type of product, market conditions, academic focus, etc. Due to the potentially lengthy process of commercialisation, there are likely to be numerous funding rounds before an exit is achieved. This is therefore likely to mean dilution for early investors and therefore understanding the upcoming stages and how these will likely affect an investor can be important. Having said that, dilution can sometimes be somewhat of a red herring for early stage investors. If
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an early stage investor is a minority shareholder then they may be unlikely to lose much in the way of rights due to dilution and as long as their share price rises and is higher on exit than when they initially invested then a real return has been produced irrespective of their percentage shareholding. Equally, if an investment manager oversees a fund raise at early stage it is feasible that they can include terms to the investment which protect their investors’ interests against the potentially negative effects of dilution. Therefore, investing early in life sciences can produce impressive returns although the already high level of risk is likely to be higher the earlier you invest and thereby another good reason to back experienced investment managers. This of course is why SEIS becomes appropriate and the incentives involved therein seek to mitigate some of the risks and thereby encourage investors to participate at this early stage. EIS and SEIS are government initiatives to reward investors for investing in potentially high risk companies, with the aim of creating innovation and/or jobs. One example is a company a colleague of mine was previously party to where a company was developed from seed through to NASDAQ flotation. The early stage investors all earned between c.30x and c.90x their initial investment whereas those who waited until after listing to invest actually may have lost money as the peak market cap was significantly higher than a subsequent Big Pharma acquisition. Mentoring with authority Particularly with early stage companies, the mentoring of an experienced investment manager or venture capitalist can be extremely useful, particularly for companies who are founded by academics rather than experienced commercial minds. To be able to have the authority to guide such companies, the manager should have an understanding of the market and the language of the sector. Only by understanding the industry
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EIS Magazine · July/August 2016
can an adviser guide a company with authority.
Door opening and connections Early stage companies can often benefit greatly from referrals, connections and favours from those more experienced in their sector. If the investors can provide that service to the company then it can prove highly beneficial in gaining traction, interest and market share at an accelerated pace. The life sciences sector is closeknit and having doors opened with key contacts and Big Pharma could be influential to the chances of success. Understanding routes to exit As explained earlier, the life sciences market is complex, highly regulated and insular. Therefore, having
knowledge of the market, the market players and the parties who may be interest in acquiring other businesses is essential when considering an exit. Exits within this sector will usually be by way of a trade sale or IPO. Trade sales are particularly common for pharmaceutical companies, drug-discovery organisation and R&D practitioners. The well know Big Pharma brands increasingly buy smaller companies which have developed intellectual property or undertaken considerable R&D in order to fast-track development and reduce their internal timescales. For some companies this may be their only exit option but if there is interest from multiple parties then a competitive bidding process could be fashioned in order to create the optimum exit.
For those companies with clear commercial revenues, an IPO may be more appropriate route to maximising exit valuation.
Understanding valuations When seeking a return for investors, it is of course necessary for any company to be able to accurately value their business and understand the contributing factors. Some businesses within the life sciences sector may be valued in a very different manner to standard commercial companies. The very nature of some businesses in this sector is that they may never generate commercial revenues but may still have a tradeable asset in IP or R&D. Valuing such assets can be very specific and any investor unused to this could struggle to identify an optimum exit opportunity, may value the business incorrectly and might be unable to identify potential exit opportunities all together. Investing in life sciences can be extremely rewarding from both commercial and social perspectives. Investing in such companies not only has the potential to produce rewarding financial returns but it is also often the case that investors are excited to be investing in products and research that could potentially save lives, cure illnesses and or make lives more comfortable. There are not many ‘asset classes’ where this is part of the potential reward on offer. However, investors should always understand that companies in this sector can take considerable time to develop to a point where an exit may be possible and during this period it may be difficult to value progress. Due to the unique nature of this sector, investors should consider a portfolio approach to investing and seek to invest via investment managers who understand the market and have practical experience of helping such companies grow and exit in this unique sector.
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The growing attraction of smaller companies With plenty of encouragement for UK small businesses in the March 2016 Budget, Octopus Investments’ Paul Latham explains why there are more ways than one to invest in them Ever since the establishment of the enterprise investment scheme (EIS) and venture capital trusts (VCTs) in the mid-1990s, it’s fair to say that successive governments have demonstrated belief in attracting investment into some of Britain’s most exciting and entrepreneurial companies. And why not – both EIS and VCTs have been a vital source of funding for smaller, growing companies that help to generate thousands of jobs and make a significant contribution to the UK economy. As the largest provider of VCTs and EIS in the UK , Octopus has more than 7,000 EIS investors and manages more than £500 million in its EIS products . Since we began offering EIS products in 2004 we have invested more than £1 billion in energy generating companies that qualified for EIS. According to HM Revenue & Customs, EIS funding increased by more than £500 million over the 2013-14 tax year and reached the £1.5 billion mark . This all goes to show what a valuable and established planning tool EIS has become for many investors. It’s not hard to see why – there are the generous tax reliefs for one thing: up to 30% income tax relief, the opportunity to defer capital gains tax and 100% relief from inheritance tax as long as required holding periods are met. But EIS isn’t the only way to take advantage of the investment potential in smaller companies. In fact, for a number of reasons we are seeing VCTs becoming more and more attractive for many investors. Conversations we are having with advisers would suggest they are increasingly seeing VCTs as a more mainstream investment option for clients that are looking to complement and
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diversify their existing retirement portfolio – as long as those clients are comfortable with the risks of investing in smaller companies.
The case for VCTs The raft of changes to pensions – including the ‘freedoms’ that came into force last year and the continued restrictions on the amount investors can set aside to put into their pension – have certainly opened people’s eyes to a world of possibilities. Rather than looking at their pension as the only option, investors are looking more broadly at how they use ISAs, pensions, VCTs and property, among other alternatives, to help them to plan for a comfortable retirement. Let’s take an example. Since qualifying as an architect some 20 years ago, Sarah has been paying a portion of her salary into a defined contribution
pension scheme alongside her employer’s contributions. Over the years she has built up a sizeable pension. But now that the lifetime allowance (LTA) has been reduced to just £1 million, Sarah is worried that her pension could exceed that amount by the time she retires and she’ll face a tax charge of up to 55% on the excess. To make sure this doesn’t happen, Sarah would like to find alternative ways to invest for retirement – preferably ways that still offer her a tax-efficient income. Sarah talks to her financial adviser: she is comfortable with the higher level of risks associated with investing in smaller companies and she is willing to leave her money invested for at least five years. Based on this assessment and her attitude towards smaller company investing, he suggests investing in a VCT.
Sarah can claim up to 30% income tax relief on up to £200,000 invested in any single tax year, on the proviso that she retains her VCT shares for at least five years. She can also benefit from tax-free dividends and potential gains. When she chooses to sell the VCT shares, they will also be tax free. At Octopus, we’re certainly seeing a lot more demand for our range of VCTs on the back of the pension reforms – we saw record breaking inflows into Octopus Titan VCT, the largest VCT in the UK, which raised over £100 million in the last tax year. It’s not just the tax benefits that make VCTs so attractive to investors either. For many, it’s the opportunity to share in the growth potential of fast growing, exciting young companies. Our VCTs have backed several successful businesses from an early stage, including property group Zoopla, UK travel company Secret Escapes and SwiftKey – the company behind the app for faster, easier typing on mobile phones and tablets, which was acquired by Microsoft earlier this year. We invested in Zoopla at a very early stage and we followed that investment right through to it becoming nearly a billion-pound
SMALL
BUSINESSES
business when it listed on the main market of the London Stock Exchange. It’s a perfect example of VCT money being used to grow a fledgling business, creating hundreds of jobs and delivering a fantastic service to its customers.
We invested in Zoopla at a very early stage and we followed that investment right through to it becoming nearly a billion-pound business
And while VCTs might not have the same breadth of tax reliefs as an EIS investment they have a number of distinct advantages for those looking to build their wealth over the long term. For instance, income tax relief is offered to VCT investors as soon as shares in the VCT have been
HELPING THE
UK ECONOMY
allotted, whereas it can take several months or even years to fully invest a portfolio of EIS companies, so the upfront tax relief also takes longer to reach EIS investors. Moreover, when it comes to selling shares in a VCT, it is usually easier to return the proceeds to investors than a portfolio of EIS qualifying companies. The ability to pay tax free dividends also offers an interesting source of income from investment through to retirement. Of course, VCTs and EIS shouldn’t be considered as a replacement for pension investments, which will typically be lower risk and generate lower net returns.
The AIM advantage Another way of accessing the investment opportunities presented by the UK’s smaller companies is to invest in the Alternative Investment Market (AIM). The government set up AIM in 1995 – around the same time as EIS and VCTs – and it has been a hugely successful platform for smaller,
MAKING MORE
JOBS AVAILABLE
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growing companies to gain access to capital, while opening up opportunities for investors that are keen for a slice of the small business pie. A number of VCTs use AIM-listed companies in their portfolios. What’s more, in the last couple of years, a key change to legislation in support of AIM has been the allowance of AIM-listed companies to be held in ISAs. The advantage of an AIM ISA is that the shares are expected to become free from inheritance tax if they have been held for at least two years and are still held by the investor on death. That’s because certain AIM-listed companies qualify for business property relief (BPR), which is an investment incentive that has been part of primary inheritance tax legislation since 1976. Over the past decade, BPR has become an increasingly mainstream option for investors interested in reducing any inheritance tax liabilities that will become due on their estate. Consider the example of 70-yearold Peter, who is concerned about
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EIS Magazine · July/August 2016
inheritance tax. His house is worth more than £325,000, so his daughter Emma will have to pay 40% tax on much of his estate when he dies. This includes the ISA investments he’s been building up over the years. He’d like to find a way to invest that retains the tax benefits of an ISA wrapper, without the inheritance tax liabilities. Peter talks to his financial adviser, who presents the option of placing his money in an ISA product that invests in a selection of AIM-listed companies that qualify for BPR. And after holding the shares for two years the investment should become free from inheritance tax, as long as he still holds the shares when he passes away. The estate planning benefits of this type of ISA offer an attractive option for ISA transfers, especially with older clients who have large estates, have built up significant ISA portfolios, and who are comfortable with the higher level of risks associated with investing in smaller companies. The government accepts the tax benefits offered by these smaller
company investments because of the risks. It’s worth pointing out, however, that although these companies are smaller than many of those on the main market, they will still typically be worth many hundreds of millions of pounds. Many of them – like Asos, Majestic Wines and Young & Co.’s Brewery, for instance – are household names.
A question of choice There are many ways to invest in the UK’s smaller companies and, given the range of options available to investors, there’s a growing need for more people to speak to a financial adviser. Choosing to diversify your investments and put your money to work in the UK’s high-growth small businesses – whether that’s through a VCT, EIS or an AIM portfolio – won’t be the right decision for everyone. But for the right type of investor, who understands and accepts the risks involved, the option of tax-efficient investing in the UK’s smaller, growing companies is one that’s becoming very difficult to ignore.
ACQUISITION AND SALES
O F I FA BUSINESSES Retirement? Time for a change? There are countless reasons to dispose of an IFA business, just as there are countless reasons to get hold of one.
W E A R E A SPECIA L I ST F I NANC IAL S A L E S , CO N S U LTA N CY A N D BR O KE R AGE B US I N ES S . Gunner & Co.’s mission is to work directly with you, whether you are looking to realise the capital in your business, or you are looking for growth through a merger or acquisition. We consider every business to be unique, and therefore finding the right solution for you starts with a thorough understanding of your business operations and your wish list. Only from here can we make valuable introductions which align to both party’s needs. If you would like to discuss options to sell, exit or retire, or acquire IFA businesses, please get in touch for a confidential discussion.
louise.jeffreys@gunnerandco.com
gunnerandco.com
INFORMATION
MEMORANDUM For further information, please contact
Nicola Johnston Head of Finance nicolajohnston@chfmedia.com +44 (0)845 512 1000
www.chfenterprises.co.uk i
Open Offers Highlighting some of the key offerings currently available to IFAs
Investment Key:
EIS
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Downing Ventures EIS - High risk, high potential return Our Downing Ventures EIS focuses on early-stage UK technology companies, offering our investors a high risk, high potential return investment opportunity with attractive EIS tax reliefs. We believe that our portfolio is one of the most diversified in the UK venture capital market, with 21 investee companies as at 1 April 2016, spread across a range of sectors including life sciences, education technologies and consumer internet. We aim to allocate a portfolio of between 8 to 10 of these companies to each subscriber in order to spread risk. We have built strong relationships with major partners such as the LCIF (London CoInvestment Fund), the MoD (Ministry of Defence) and the incubator Webstart Bristol. We are always looking for talented management teams and new investment opportunities. Our Ventures team receives and analyses on average 40 new investment opportunities each month (based on the average number of investments opportunities reviewed from 01/10/2014 to 30/09/2015). This financial promotion has been approved by Downing LLP, authorised and regulated by the Financial Conduct Authority (FCA). This promotion is directed only at FCA authorised advisers. For more information, including the risks, please visit www.downing.co.uk.
Deepbridge - Technology Growth EIS The Deepbridge Technology Growth EIS represents an opportunity for investors to participate in a portfolio of actively-managed growth-stage technology companies, taking advantage of the potential tax benefits available under the Enterprise Investment Scheme. The Deepbridge Technology Growth EIS is a diversified portfolio of actively managed high-growth companies seeking commercialisation funding. The Deepbridge EIS invests in companies that have a proven technology, clear intellectual property and are operating in a high growth/high value market sector. Focused on investing in high growth companies that are seeking to commercialise and expand, specifically in three sectors:
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• Energy & resource innovation; • Medical technology • IT-based technology
The target return for the Deepbridge Technology Growth EIS 22.9% p.a. over a minimum of three years; representing mid-case capital growth of 160p returned for every 100p invested. To ensure maximum tax efficiency for the investor, the Deepbridge EIS is entirely investor-fee free at point of investment. July/August 2016 · www.eismagazine.com
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EIS Open
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T. 0131 556 0044
PUMA INVESTMENTS - PUMA EIS Puma EIS employs an investment strategy similar to that successfully deployed by the Puma VCTs and aims to provide investors with downside protection in a carefully managed portfolio. Building on Puma’s established track record in tax efficient investments, Puma EIS targets asset-backed businesses aiming to provide downside protection for investors through a portfolio exposure to HMRC pre-approved companies. Successful Deployment: Puma EIS was the largest fundraise of any new EIS with a capital preservation strategy launched in 2013/14 tax year. All funds raised were successfully deployed into companies with HMRC Advanced Assurance before the end of the tax year end. Allotment Dates: The discretionary management service has no fixed closing date. Puma EIS intends to make quarterly allotments with an allotment shortly in advance of the tax year-end each year. Strong Track Record: Building on the market leading track record of the Puma VCTs which operate a similar asset-backed investment strategy. Realisations: It is envisaged that investments in Qualifying Companies will be realised within 3 to 5 years. Investment Size: Minimum subscription is £25,000 with no upper limit.
Par Syndicate EIS Fund The Par Syndicate EIS Fund is an evergreen EIS fund, unapproved by HMRC, investing in innovative high growth potential companies with a view to generating capital gains. The fund, managed by Par Fund Management Limited, made its first investment in December 2012 and realised its first exit in June 2016. The fund’s mandate is to invest alongside (and on the same terms as) business angel syndicates, and usually, but not exclusively, co-invests with the Par Syndicate, a leading business angel syndicate that has been investing in a broad range of technology businesses since 2009. The fund may be promoted to retail investors under COBS 4.7. Independent research reports have been published by Hardman & Co. and MICAP.
E. info@parequity.com www.parequity.com
EIS Open
Now
Close
Evergreen
Minimum Subscription: £10,000
Rockpool’s EIS Portfolio Service Rockpool’s EIS Portfolio Service offers an alternative to traditional EIS funds with investment direct into private companies. Investors can choose the Managed service and build a portfolio of EIS qualifying private company investments to suit their investment strategy and required diversity through the Managed service. Alternatively, investors can choose the companies to invest in and build a bespoke portfolio through the Self-select service. Two strategies are available: Growth and Asset-rich. Asset-rich sectors include: crematorium operation, construction project delivery, managed storage services and children’s nurseries.
T. 0207 015 2150 E. team@rockpool.uk.com www.rockpool.uk.com
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EIS Magazine · July/August 2016
Rockpool’s model offers full transparency with opportunities to meet the management, regular updates on the investment performance and an on-line portal for latest valuations. ∞ Managed service – Minimum application of £10,000 with a minimum investment of £2,500 per company. ∞ Self-select - Minimum investment of £10,000 per company.
EIS Open
Close
Now
15/07/16
Amount to be Raised: N/A Minimum Investment: £25,000
Motion Picture Capitals - HMRC Approved EIS Fund Motion Picture Capital, a Reliance Entertainment Group company, has been producing and financing independent film and television productions since 2012. Their HMRC Approved EIS Fund has a distinctive charging structure, with an initial charge of 2.5% and NO further annual management fees, or exit fees. The fund offers investors access to a diversifying sector, largely uncorrelated to many asset classes, through a blend of both performance driven and more predictable sources of returns that aims to provide the potential for significant returns whilst mitigating risk through careful structuring of its investment.
T. 020 7025 8195 E. info@motionpicturecapital.com www.motionpicturecapital.com
EIS Open
December 2015
Close
At Capacity
Amount to be Raised: £20m
T. 020 7391 4747 E. questions@time-investments.com www.time-investments.com
EIS
SEIS
Open
Close
Now
Evergreen
Minimum Subscription: £20,000
TIME:EIS Shipping TIME:EIS Shipping invests in dry bulk shipping, offering investors an asset backed opportunity in a global industry that has been established for thousands of years. Shipping is a sector recently identified by the Government as vital to the UK economy and one it is keen to support. Targeting a base case return of £1.27 for each net 70p invested, this noncontentious business model makes TIME:EIS Shipping an excellent fit within the EIS regulations – which is why advance assurance from HMRC has already been granted. TIME:EIS Shipping has an initial capacity of £20 million, after having raised its full £5 million for its first tranche in the 2015/16 tax year, tranche 2 is now open for investment in the 2016/17 tax year. Alongside our specialist EIS team, support is provided by third parties with substantial experience in shipping. Key information for TIME:EIS Shipping • Asset backed, with investment realisation expected within 4-5 years • Each vessel purchased without use of debt, thereby reducing the overall risk profile • Highly rated by independent researchers • Minimum investment £10,000
Kuber Ventures Multi Manager Platform Kuber Ventures Alternative Investment Platform allows investors to create a portfolio across different Fund Managers for EIS/SEIS/BPR investments. Through a single application and depending on the scheme selected, investors can create a diversified spread of qualifying investments. Investors may select individual funds or choose to achieve further diversification by investing in one of the Kuber strategies available. Our strategy choices include: • Business Property Relief (Minimum Subscription £50,000)
T. 020 7952 6685 E. info@kuber.uk.com www.kuberventures.co.uk
• Asset focused strategy • Seed EIS strategy
• Diversified growth strategy
July/August 2016 · www.eismagazine.com
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EIS
SEIS
Open
Close
August 2012
Evergreen
Amount to be Raised: N/A
T. 01865 784466 E. lucius@oxfordtechnology.com www.oxfordtechnology.com
SEIS Open
Now
Close
31/08/16
Amount to be Raised: N/A Minimum Investment: £10,000
Oxford Technology EIS/SEIS Fund Oxford Technology has specialised in investing in high risk/high potential return technology start-ups since 1983. OT(S)EIS is fund no 14, and remains open for investment at any time. Investors end up with a portfolio of SEIS and EIS investments after 36 months. The SEIS scheme transforms the economics of investing in start-ups. The losses on those which fail are greatly reduced. The gains on those that succeed are tax free. They key to success is to take real risk and to make large gains on the successes. To date we have made 22 investments and have had two failures (there will surely be more in due course). But the losses on the failures, after tax reliefs are only £12,300 and £21,000. So far we have had three successes (there will surely be more) and the gains on these (only on paper so far) are >£2m. Our quarterly report, which gives a page of information on each of the investments may be downloaded from www.oxfordtechnology.com. Investors email to say how much they like this. Min investment £15,000. No initial fee. 3% introductory fee to IFAs. Man. fee 2% pa for 3 years, then 1.5% pa accrued. 0.35% pa custodian fee. 20% performance fee after hurdle achieved. Full details in IM, also downloadable.
Motion Picture Capitals SEIS Fund Motion Picture Capital, a Reliance Entertainment Group company, has been producing and financing independent film and television productions since 2012. Their SEIS offers investors the chance to invest in the development of film and television content, joining the life of productions at the outset, targeting the potentially significant rewards that can be generated by investing in intellectual property at the earliest stage of the production cycle, whilst mitigating the risks involved by subscribing in shares that allow investors to benefit from SEIS tax reliefs. The fund has a 3% initial charge and NO further annual management fees, or exit fees.
T. 020 7025 8195 E. info@motionpicturecapital.com www.motionpicturecapital.com
EIS Open
01/10/2015
SEIS Close
Evergreen
Amount to be Raised: N/A
T. 020 7060 3773 E. chris@boundarycapital.com www.boundarycapital.com
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EIS Magazine · July/August 2016
Boundary Capital AngelPlus Fund AngelPlus Fund from Boundary Capital is an early stage technology fund with unique features and blended EIS and SEIS benefits. Its main advantage is that it only invests alongside ‘Venturers’ who are experienced entrepreneurs and executives who invest their own money alongside Boundary and take an active board seat alongside Boundary’s investment director. This helps to derisk the investment and adds value to the founders. Boundary nurtures a network of 300+ Venturers. There are also coinvestment opportunities for investors in AngelPlus, who get private access to Boundary’s private dealflow and briefing notes. The Team at Boundary Capital are experienced entrepreneurs and investors themselves and have over 60 year’s collective venture capital experience and between them have led 14 funds with over £200m under management and achieved over 60 exits with aggregate returns ranging from 1.4 to 3.0x. There are no fees to pay by investors so 100% of the fund is invested. Rebates are available to introducers.
BPR Open
Close
01/07/2015
N/A
Amount to be Raised: Uncapped
T. 01244 746000 www.deepbridgecapital.com
VCT Open
Close
26/10/15
21/10/16
Minimum Investment: £5,000
T. 020 7493 4940 E.madeleine@calculuscapital.com www.calculuscapital.com
VCT Open
Now
Close
15/07/2016
Minimum Subscription: £3,000
T. 0131 503 9100 E. info@amatiglobal.com www.amatiglobal.com
Deepbridge IHT Service The Deepbridge IHT Service is designed to deliver capital preservation from a portfolio of Business Relief qualifying renewable energy companies that seek to have a high degree of asset-backing and a business model based on the Renewables Obligation, the UK Government subsidies for the generation of renewable energy. Utilising Business Relief, subscriptions may be eligible for exemption from IHT after a minimum of two years. The Deepbridge IHT Service has a target priority return of 6% per annum after the second year. Investment criteria: • Attractive subsidies: The UK Government offers subsidies to the renewable energy sector, including Renewable Obligation Certificates and Feed-in-Tariffs. • No planning risk: Investments will be made in projects with all the necessary permissions in place, providing a known cost base for the investment.
• Proven technology: The use of proven renewable energy technologies that allow levels of energy production to be forecast with a good level of accuracy.
Calculus VCT plc D Share Offer is OPEN for Subscription Calculus Capital are best known in the market for their skills and experience as aninvestor in established, unquoted SMEs. The awards we regularly win are evidence of that. Our long standing investment team and diligent investment process have led to an exceptionally strong track record of investment success. The key points of the D Share offer are: • Calculus VCT plc aims to pay an annual dividend of 4.5% of NAV from the first year (6.1% tax free on net cost after 30% tax relief), the company has a successful track record of delivering dividends to investors. • By co-investing in selected established companies through both VCT and EIS, we are able to choose larger companies and bigger deals – reducing the risk profile of the investment. • Our experienced investment team and thorough investment process have produced impressive dividend performance and exit returns for investors. • Discounts: 0.5% summer discount for subscriptions received by September 30th 2016 0.5% additional discount for existing Calculus VCT plc investors The full Prospectus is available on our website: www.calculuscapital.com
Amati VCTs Top Up Offers 2016/2017 Amati Global Investors is a well-established manager of AIM-based VCTs. The Offers provide existing and new investors the opportunity to invest in one or both of Amati VCT plc and Amati VCT 2 plc: •Investment into an existing portfolio of more than 60 companies in each VCT, covering both high-growth and maturing businesses. •Tax free dividends, targeted at 5-6% of year-end NAV (although there is no guarantee the targets will be met). •AIM based VCTs typically have a more diversified portfolio than other types of VCT, and are likely to be invested in larger, more established companies, with transparent market pricing and reasonable liquidity. • Minimum subscription £3,000 or £2,500 per VCT if applying for both Offers. Should you wish to receive monthly Amati fund factsheets, please request from info@amatiglobal.com To view remaining capacity for 2016/2017, please visit: http://amatiglobal.com/ avct_share_offer.php July/August 2016 · www.eismagazine.com
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IHT
BPR
Open
Close
Now
Evergreen
Minimum Investment: £50,000 Amount to be Raised: Unlimited
T. 020 7201 8989 E. contact@triplepoint.co.uk www.triplepoint.co.uk
BPR Open
Evergreen
Close
Evergreen
Amount to be Raised: Unlimited
T. 020 7391 4747 E. questions@time-investments.com www.time-investments.com
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EIS Magazine · July/August 2016
Triple Point Estate Planning Service Triple Point Estate Planning Service is designed to meet investors’ requirements for an inheritance tax mitigation solution that is clear and straightforward. This allows them to remain in control of their assets with ongoing access to funds and a rapid IHT Qualification after two years. This service gives investors access to our two established strategies, built and managed by a team with a proven and profitable 10 year track record. Navigator Strategy • Lending and leasing to a large and diverse range of UK-based small and medium sized businesses • 4.0%-6.0% per annum targeted returns, net of fees • £5,000 average contract value of underlying investments • £176m of funding provided to date Generations Strategy • Leasing, lending and infrastructure funding to the public sector (Local Authorities, NHS) and to good quality companies, • 1.5%-2.5% per annum targeted returns, net of fees • £250,000 average contract value of underlying investments • £275m of funding for leasing and infrastructure provided to date Please contact the sales team for more information on this offer or Triple Point’s EIS and VCT products. Investments can be illiquid and the value of your investment is not guaranteed.
TIME: CTC (Corporate Trading Companies) TIME:CTC is a bespoke Inheritance Tax (IHT) solution for corporate investors, which boasts an impressive 20 year track record of delivering IHT relief for investors. TIME:CTC is aimed at business owners who have built up surplus cash in their business and could potentially lose Business Property Relief (BPR). The focus of TIME:CTC is on capital preservation by investing in asset backed businesses which qualify for BPR. These businesses include secured lending, renewable energy and self-storage. Our strategy allows business owners to maintain control of their assets, avoiding the need for trusts or gifting to obtain relief. Targeting a return of 3.5% and potentially immediate reinstatement of BPR qualifying assets. To date more than 500 of our clients have already achieved BPR on their investments, a 100% success rate.
BPR Open
Close
Evergreen
Evergreen
Amount to be Raised: Unlimited
T. 020 7391 4747
TIME:Advance TIME:Advance is a discretionary management service that allows investors to access Business Property Relief (BPR) to mitigate their Inheritance Tax (IHT) liabilities. The service offers 100% IHT relief in just two years, alongside a targeted return of 3.5% per annum. Importantly clients retain access and control, so have the option to withdraw a lump sum or set up regular withdrawals in the form of an income. The service focuses on capital preservation by investing in asset backed businesses with no debt which qualify for BPR. These businesses include secured lending, renewable energy and self-storage. The product is managed by an expert team, with a proven 20 year track record of 100% success in achieving BPR for investors.
E. questions@time-investments.com www.time-investments.com
BPR Open
Close
Evergreen
Evergreen
Amount to be Raised: No Max
T. 020 7065 6699 E. enquiries@marianainvestments.com www.marianainvestments.com
IHT Open
Now
Close
Evergreen
Minimum Subscription: £50,000
T. 0207 015 2150 E. team@rockpool.uk.com www.rockpool.uk.com
Mariana Estate Planning Solution Mariana Estate Planning Solution (Mariana EPS) is an evergreen BPR portfolio service managed by Enterprise Investment Partners LLP (Enterprise) with Mariana Capital Markets LLP (Mariana) as the Investment Adviser. The service is designed to be an investment which, if held for at least two years and at the time of death, can be used to shelter part of an individual’s estate from Inheritance Tax. The service is run under a strict capital preservation mandate; it is seeking to invest in a separately operating BPR qualifying company whose primary trade is anaerobic digestion (AD). Mariana has partnered with a major subsidiary of a FTSE 100 company – the company has been in business for over 100 years and are the world’s second largest producer of sugar. This company wish to strengthen the relationship with its farming supply chain, through the delivery of a program of farm-based AD plants. In return for a fully funded solution, this company will help to operationally de-risk the project via the provision of deal flow, robust feedstock and maintenance contracts and long-term operational supervision. Mariana aim to provide regular liquidity to Mariana EPS investors; exit opportunities are available on a monthly and quarterly basis. Enterprise, the Investment Manager, has a strong track record, has raised over £200 million in tax efficient investments in the last four years and has substantial experience in the sectors in which this product sits.
Rockpool’s Managed Inheritance Service Rockpool’s Managed Inheritance Service is designed to deliver 100% exemption from inheritance tax after two years. Investment through Rockpool’s Managed Inheritance Service will be made in unquoted shares in specialist lending companies who provide loans to corporate borrowers. Our objective is to deliver a 5% net annual return with low risk to capital and the flexibility to take income or accumulate gains. The service has a simple, low cost transparent structure. Rockpool’s Managed Inheritance Service facilitates adviser charges or introducer fees. July/August 2016 · www.eismagazine.com
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Crowdfunding for Advisers
The Bottle Shop is one of the UK’s leading craft beer companies. Distributer, retailer, wholesaler and importer of bottled craft beer. With an online offering alongside retail locations in London and Canterbury.
Quvium is developing a small wearable medical device which has the power to predict an asthmatic attack before it occurs, consequently reducing A&E visits, hospitalisations, and deaths from asthma, particularly in children.
The Recyclabox allows customers to easily recycle old Phones, Tablets, Games & DVD’s. The business has been trialling its product in a major supermarket chain and is about to roll out across the UK.
Bo66y is a film that marks the 50th anniversary of England's victory in the 1966 World Cup. It uncovers the truth behind Bobby Moore, England's greatest Captain, who fought many more battles than millions witnessed on the football field.
Register free of charge at www.seedeisplatform.com. For further information, please contact us: 020 7071 3945. Risk Warning Investing in start-ups and early stage businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution. It should be done only as part of a diversified portfolio. Seed EIS Platform is targeted exclusively at investors who understand these risks and can make their own investment decisions. Investments can only be made by members of Seed EIS Platform on the basis of the information provided in the pitches by the companies concerned. Tax treatment depends on the Magazine · of July/August 2016 individual each client and may be subject to change in the future. 34 EIScircumstances
Candlewick House, 120 Cannon Street, London EC4N 6AS Call: 020 7071 3945 enquiries@seedeisplatform.com www.seedeisplatform.com
TIME to look again
Innovative solutions, defensive investments TIME provides tax efficient investment solutions and we’re proud to say we’re rather good at it with more than £500 million of assets under management and a 20 year track record of success. What stands us apart in our market is our focus on seeking consistent stable returns for our investors, which we deliver through a defensive investment strategy.
We offer the longest track record of all BPR providers (20 years and counting)
Our distribution team of 19 provides national coverage to help advisers provide solutions tailored to their clients’ needs
We focus on capital preservation throughout our investment solutions
What do we look for when investing? Predictability
We’re dedicated to the adviser market; we don’t accept direct client investments
We pride ourselves on providing genuine transparency about where and what we invest in
Asset backing Income generation
We have an in house team of 12 investment specialists, offering a real depth of experience
Find out more 020 7391 4747 questions@time-investments.com time-investments.com This notice is aimed at financial advisers only and is not intended for retail clients. TIME Investments is a trading name of Alpha Real Property Investment Advisers LLP and is authorised and regulated by the Financial Conduct Authority.
July/August 2016 · www.eismagazine.com
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Delivering calculated excellence for your clients We offer a range of tax-efficient investments with a proven track record of delivering for our investors and the businesses we support. Our VCT, IHT, EIS and AIM investments suit a variety of tax planning needs which our expert team are happy to support you and your clients with across every step of the process. Call our Business Development Team on 0207 408 4100 or visit pumainvestments.co.uk to find out more.
This advertisement is an exempt financial promotion issued by Puma Investments. It is for the use of professional advisers only and should not to be relied upon by retail clients. Puma Investments is a trading name of Puma Investment Management Limited which is authorised and regulated by the Financial Conduct Authority. Our offerings place your clients’ capital at risk and investors may not get back the full amount invested. The tax treatment of our offerings depends on individual circumstances and may be subject to change. Past performance is not a reliable indicator of future results.
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