One of Scotland’s leading investor groups has launched a £5m fundraise to help high growth potential businesses with a sustainability focus to scale up.
SIS Ventures is opening a second round of its environmental, social and governance focused ‘impact first fund’ to offer investors the chance to support businesses which are aligned with UN Sustainable Development Goals (UNSDGs), allowing them to make tax-efficient financial and impact returns.
The fund has already invested £1.3 million into eight high impact and high growth potential businesses and continues to deploy £5 million Scottish Government funding into a strong pipeline of impactful businesses.
Each business is led by a ‘mission’ including, for example, providing earlier diagnosis for life-limiting diseases such as cancer (Dxcover Limited) and Parkinson’s (Manus Neurodynamica), tackling some of the world’s most serious online harm issues (Cyan Forensics), encouraging the switch to Electric Vehicles through on-street charging points (Trojan Energy), and helping pharma deliver better patient health outcomes (Talking Medicines).
This second Enterprise Investment Scheme (EIS) fundraise presents an opportunity for investors to support both existing Impact First investees to grow through follow-on funding rounds, as well as invest in new, early-stage businesses. The minimum investment sought from investors is £20,000, with each investor invested in at least six businesses over a period of seven to ten years.
SIS Ventures’ approach to investment management includes working with investee management teams to lock their mission into their company Articles of Association, ensuring that social and environmental impact returns and financial success are ‘symbiotic’. The mission lock also ensures that management teams are driven to ‘prioritise impact’ as the business scales.
David Ovens, chair SIS Ventures, said: “Using the power of business and innovation to help address society’s greatest challenges and needs, a global culture shift is underway to build a more impactful and inclusive economy. The societal issues of today require ever more innovative solutions. At SIS Ventures we believe that impactful businesses, those that combine profit with purpose, are the future and should be supported with the full power of the investor community. Impact First is developing an impressive track record, a strong pipeline and a worthy reputation as the leading investor in this space. I hope that the fundraising will be well supported by those who share our mission to create an impact economy.”
Jill Arnold, head of SIS Ventures, said: “Demand for investment funding from mission-led entrepreneurs has surpassed all of our expectations. Since launching Impact First, we have proved without doubt that there is more than sufficient appetite for such a fund among highly ambitious businesses with aspirations for growth.
“We also know that in recent years impact investing has soared in popularity among the global investor community. While many have adopted a ‘wait and see’ approach, based on the relative scarcity of evidence to support an impact-first investment approach, with our first portfolio of investments almost complete, we are now able to more visibly prove the investment case. Despite the challenges presented by Covid-19, all investees are performing well, and there are emerging signs of strong exit potential.”
