LBA launches £2.5m LBA Ventures Scale-Up EIS 1 Fund to invest in innovative business raising capital to scale up commercial operations
LBA is pleased to announce the launch of its latest innovative fund offering, the LBA Scale Up EIS 1 Fund (SUF), which is now open for subscriptions (with the closing date for new subscriptions being 5th April 2017). SUF is an HMRC Approved EIS fund, facilitated by LBA being FCA regulated and managed by Larpent Newton & Co.
SUF will seek to invest in a portfolio of 6-8 deep technology EIS eligible opportunities over a year long investment cycle that are raising capital to bolster operational and commercial growth.
SUF is a natural extension to LBA’s other EIS funds which have previously focused on companies at the earlier/seed stage. Scale Up Companies are tightly defined by the OECD as companies that can show at least 20% per annum revenue growth over 3 years and have a minimum of 10 employees.” In 2016, the UK’s Scale Up Institute identified 11,500 such companies in the UK. Scale Up companies tend to be generally less risky than start-ups as the proof of concept and revenues have already been established, and the primary risk exposure is market risk rather a pure technology risk. In their last report, the Institute also cited a funding gap between Start-Up/Seed stage and the larger Venture Capital led rounds as a main challenge for Scale Up companies. It is the ambition of this Fund to help companies get through this ‘valley’; to play an active part in the company’s growth plans through funding, advice, mentoring and syndication with other UK Angel groups to provide multiple sources and types of growth capital, from equity to debt financing and links to potential exit partners.
LBA believes that it is very well placed for this challenge; seeing 1500 start-up/scale-up companies each year gives it one of the largest pipelines of opportunities in the UK. Alongside these, the LBA co-invests with multiple syndication Partners, which results in not only shared risk, but also gives strong minority investor protection. The SUF team has over 80 years’ of experience in the early stage investment market and includes Hitesh Thakrar (ex ADIA Global Innovation Fund manager and currently a venture partner at the £1bn Syncona life sciences fund) and is well placed to take advantage of deal flow through LBA’s position as one of the UK’s leading private investor groups.
Anthony Clarke, LBA’s CEO, comments, “Since 2010, LBA has facilitated 7 EIS funds and 1 SEIS funds, deploying alongside other angel investors over £2.5m into 39 seed and early stage companies, many of which are now showing signs of accelerated sales growth of over 100% per annum. SUF is designed to invest in slightly later stage pre Series A/scale up opportunities sourced from LBA’s extensive deal flow network including its existing portfolio. The SUF team have a longstanding track record of early stage investing and LBA’s proprietary deal flow means that it is well placed to address the UK’s current scale up funding gap.”
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