EIS and the SME Arena

13th May 2020

The impact of COVID-19 has been felt across the globe, and for small firms in the UK this is no exception. While some smaller firms are struggling and making use of Government schemes to bolster their cash flow, others are coming into their own. Firms in the medtech and biotech industries in particular are seeing an increase in demand for their products and services. For these businesses, support from private investors is crucial now more than ever. For example, IW Capital recently raised £2 million for doctor-on-demand service GPDQ.

Small and Medium-sized Enterprises (SMEs) are going to be absolutely key to the state of the economy in both the near and distant future, as SMEs account for 98% of all private sector businesses meaning their growth is closely linked to the economy as a whole. These small businesses contribute £1.9trillion annually to the economy of the UK. In other words, the health and wealth of SMEs will directly affect the state of the UK economy and its recovery in a post-Coronavirus world.

Investing in high-growth companies is a vital part of helping the SME arena to thrive in the future. The UK has some of the best, brightest and most ambitious entrepreneurs and innovators in the world, who offer myriad opportunities to disrupt and challenge a range of sectors. In the last year IW Capital has seen a record amount of deal flow in terms of the number of business looking for investment and a huge appetite from our investor base to support small businesses.

The use of tax efficient Government schemes, such as the Enterprise Investment Scheme (EIS), make the investment in small firms all the more appealing to private investors. The small business community is one section of the economy that has been most affected, as one of the areas most reliant on private investment and therefore the confidence of private investors to commit capital. Schemes such as the Enterprise Investment Scheme have been a hugely important source of finance for start-ups and scale-ups in the last 25 years, providing £20billion of growth capital to businesses otherwise rejected by traditional finance sources. In 2017/18 the EIS experienced the highest amount of investment ever, with close to £2billion of support for growing start-ups and scale-ups.

IW Capital is keen to help SMEs that need assistance to plan for the future and find the right kind of investment in order to help them reach the next level.

 

To find out more about IW Capital, or for more information on investment and non-executive opportunities, please speak to a member of the IW Capital team today on 020 7015 2250, or email info@iwcapital.co.uk