ESM Investments and Stirling Council set to showcase first Stirling fund
Stirling Council will join ESM Investments in showcasing the first investment fund of its kind at an event on Friday 23 February at the city’s Codebase.
The collaborative £25 million ESM Capital Growth Enterprise Investment Scheme (EIS) Fund will be used to support innovative growth and scale-up technology orientated companies across Stirling, Scotland and the North of England. The ten-year fund is expected to launch later this year with a five-year 'investment period' in a series of businesses followed by a five-year 'maturity period' where the values of the stakes, at that point, will be realised and delivered to investors.
The initial target of £25 million is sought from a mix of private and public-sector investors, and will include investment from the ESM Investments syndicate, led by founder and CEO Steven Morris. The fund will subsequently look to make investments of £500,000-£2 million in a series of strongly managed dynamic technology enterprises that are struggling to access capital for further development.
The fund intends to make investments in EIS qualifying enterprises thereby enabling investors who are UK income tax payers to obtain 30% income tax relief on the capital invested upfront and disposals free of Capital Gains Tax, plus other benefits.
The fund is planned to be the first of many that ESM Investments will launch from its Stirling headquarters as part of a larger drive in the region to create an asset management centre to rival Edinburgh and Glasgow.
A recent survey of 69 cities across the UK named Stirling as the best city in Scotland to start a new business, with a focus on its global connectivity and highly competitive costs. Stirling Council believes the support for high-growth potential and digital technology businesses will contribute to job creation and sustainable innovation.
Steven Morris was recently appointed a city commissioner, a unique approach by a regional council, to develop new opportunities in the area. SFE Chief Executive Graeme Jones is also a Stirling city commissioner.
Steven Morris, Founder and CEO of ESM Investments, said:
"It is clear that many viable, dynamic enterprises with innovative products and services, strong business plans and capable management teams, struggle to access the investment that will allow them to develop their businesses. Bridging the equity gap for early to growth stage technology companies is a major challenge to fostering innovation and entrepreneurship.
"The fund will seek to address just that as well as giving investors the prospect of attractive long-term returns from businesses that hopefully will flourish with their support.
"We have already had several strong notes of interest in our plans and really look forward to presenting further details to additional investors".
Stewart Carruth, CEO of Stirling Council, said:
"We believe the fund will help businesses, both in Stirling and outside of the region, to realise their ambitions for growth. It will provide encouragement to local scale-up companies to continue growing their businesses, thereby creating sustainable employment. It will also enable entrepreneurs outside of the area to consider Stirlingshire as a location to establish or scale-up their businesses to the next level, thereby creating new inward investment. It builds on the foundations of the City Region Deal and is a catalyst in terms of retaining and attracting talent to Stirling.
"Stirling has great potential. We have a strong pipeline of talent – digital employees of the future – through well-established collaboration between industry, Stirling Council and our partners.
“My vision is for us to become an economic and cultural powerhouse that can compete globally".
The fund will be regulated by the Financial Conduct Authority (FCA). The pre-launch event in February, will be followed by a series of investor showcases throughout 2018.
ESM Investments is a boutique investment firm established in Stirling providing investment and business consulting for technology and scale-up companies connecting entrepreneurs together.