John Glencross, acting Director General of the EIS Association (EISA), 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 link to the HMRC website: https://www.gov.uk/government/statistics/enterprise-and-seed-enterprise-investment-schemes-april-2016
Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.