12 Mar 2020

Deadline approaching for BGV’s Tech for Good SEIS & EIS Fund 2

By Paul Miller

Last year we launched our first Tech For Good SEIS and EIS Fund in response to the growing demand from individual investors to back BGV’s portfolio. In the run-up to the close of our second SEIS/EIS Fund on 3rd April 2020, we wanted to share some insights and pointers on the wider ecosystem and the opportunity with BGV. 

 

The SEIS/EIS overview

SEIS (Seed Enterprise Investment Scheme) and EIS (Enterprise Investment Scheme) are tax incentives for individual investors offered by the UK government to help stimulate investment into early-stage businesses. Since they started in 1994 (EIS) and 2012 (SEIS), more than £20 billion has been invested under the schemes. 

Reflecting the high risks involved in investing in such early-stage companies, the upfront tax reliefs for investors are 50% for SEIS and 30% for EIS. There are also lots of other reliefs available including capital gains tax and loss relief. This article by Seedrs gives a good overview.

As an investor you can invest either in SEIS/EIS funds or directly into SEIS/EIS qualifying companies. Depending on your motivations for investing, funds can provide an easy way to access a diversified portfolio with less upfront work on individual deal sourcing and due diligence, as the fund manager takes care of that. 

 

The Opportunity with BGV

Our Fund is only for people that can certify as what the FCA calls ‘elective professional clients’. It’s not for retail clients. In simple terms this means you could afford to lose all of your invested capital, and have relevant experience and knowledge of high-risk early-stage startups (either by previously investing in or running them).

We’ve had 19 investors (12 male, 7 female) in our fund to date who have invested just over £0.7 million between them. They include CEOs and company directors, investment professionals, exited entrepreneurs and experienced angel investors.

‘BGV appears to have established a genuinely differentiated sourcing approach’ – Harman & Co.

We recently commissioned a report from industry experts and independent reviewers Hardman & Co. They’ve been assessing funds like ours for over 20 years and their report does a good job of summarising our approach. You can read their full report here but amongst other points they say ‘BGV appears to have established a genuinely differentiated sourcing approach’ and ‘There are very few ESG options in the EIS fund sector and very few accelerator programmes: the intersection is genuinely unique’.

 

The Tech For Good Fund 2 closes on 3rd April 2020. Find out more, and apply here

Capital at risk, for professional investors only.