Tax Efficient Investing Performance With Tax Relief Q2 2016 1
INVESTMENT RISKS All prospective Investors should be aware that as the Symvan Technology EIS Fund and the Symvan Technology SEIS Fund 2 (each the “Fund” and collectively the “Funds”) will invest in unquoted companies, the value of Shares in the Company can fluctuate. In addition, there is no guarantee that the valuation of Shares in the Company will fully reflect their underlying net asset value, or that Investors will be able to buy and sell at that valuation or at all. The Manager, Amersham Investment Management Limited, cannot guarantee that all investment will be completed within a target investment period of 12 months. The investment described in the Memorandum will not be suitable for all investors. All potential Investors are accordingly advised to consult an investment adviser authorised under FSMA, and an appropriately qualified taxation adviser, prior to making an investment. An investment in the Funds is subject to a number of risks. Before making any investment decision, prospective Investors should consider carefully the risks attaching to an investment in the Funds together with all other information contained in the Memorandum, including in particular, and not limited to, the risk factors described therein. Additional risks and uncertainties not presently known to the Manager or those that the Manager currently considers to be immaterial, may also have an adverse effect on the business or affairs of the Portfolio Companies. Investors should consider carefully whether an investment in the Funds is suitable for them in the light of the information in the Memorandum and their personal circumstances. IMPORTANT INFORMATION This communication has been approved as a financial promotion in accordance with Section 21 of the Financial Services and Markets Act 2000 by Symvan Capital Limited, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, FCA number 685262, and whose registered office is at New Bridge Street House, 30-34 New Bridge Street, London EC4V 6BJ. This communication is only intended for distribution to market professionals, self-certified high net worth individuals and sophisticated investors. Applications for participation in the Funds may be made only on the basis of and using the application form contained in the Memorandum, copies of which are available from the Investment Adviser and the Manager. No reliance is to be placed on the information contained in this communication in making any such application. This material is directed only at persons in the UK and is not an offer or invitation to buy or sell securities. This communication is not an offer or invitation to apply for shares in the Funds nor does it solicit any such offer or invitation. This communication does not constitute tax advice. The tax treatment referred to in this communication depends on the individual circumstances of each Investor and may be subject to change in future. In addition, the availability of any tax reliefs depends on the companies in which the Funds invests maintaining their qualifying status. Past performance is not a guide to future performance and may not be repeated. The value of an Investment may go down as well as up and an Investor may not get back the full amount invested. Investment in the Fund carries substantial risk. Any investment in the Fund should be regarded as being medium to long term in nature. Investors’ money subscribed to the Fund will be committed to investments which may be of a long term and illiquid nature. The companies in which the Fund invests will not be quoted on any regulated market and, accordingly, there will not be an established or ready market for any such shares. It may be difficult to obtain information regarding how much an investment is worth or how risky it is at any given time and the Manager may experience difficulty in realising the investments (for value or at all). Symvan Capital Limited is authorised and regulated by the Financial Conduct Authority. 2
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Lifecycle Approach to each Investee Company Maturity / Growth Symvan SEIS Fund Symvan Angel Symvan EIS Fund Series A Investment Network Investment IPO £150,000 Investment £250,000 Trade Sale Board Up to ca. to representation £500,000 £750,000 Y1 Y2 Y3 Y4 Y5 Y6 4
Symvan Technology (S)EIS Funds • Deeper not wider • Diversification within the tech sector and geography • Lifecycle growth approach • Board representation • Investment Agreement • Issue management • Successful investments need follow-on funding • Avoid “stranded firms” 5
What we look for … and like • Entrepreneurial management with proven history • Underlying IP • Realistic milestones • Realistic valuations • Management controls • No egomaniacs! 6
With support from tech advisors Charles Liasides – Technology Advisor • Founder of Brainstorm – First commercial mobile text and VAS • CBI working party on establishing EIS reliefs • Director of the InCas European project examining the value of Intellectual Capital Jeff Wellstead – Technology & Talent Management Advisor • Founder & CEO of Big Bear Partners Ltd working with B2B SaaS, mobile application, cyber security and data analytics companies in seed through to exit growth stages • Talent management leadership experience with Fortune 100 companies (Merrill Lynch, Goldman Sachs, Morgan Stanley, Accenture, EDS, PeopleSoft, MessageLabs (Symantec), SpinVox (Nuance), and Kantar Market Research) Ian Pearson – Fintech & Network Security Advisor • CEO of Ballintrae - Market Data and IT Security consultancy specialising in the Financial Services sector • Knight-Ridder, MD UK & Ireland operations • Citigroup, Cognotec, The Albany Group Rajeev Saxena – Media Advisor • Red Bull, Marketing Director UK & Ireland • TBWA, Leo Burnett, HHCL 7
Deal Filtering, Selection & Due Diligence (400+ annual opportunities) • Review of business plan followed by team discussion Initial • 5-10 companies per week contact • 33% proceed • Assess team quality and experience ≅ 130 Meeting • Integrity and reputation • Business merits • 33% proceed • Consensus view on technology and market Symvan • Portfolio composition Adviser ≅ 45 • Risk considerations Review • 33% proceed • Site visit • Intensive interviews Further ≅ 15 • Financial & commercial review meetings • Heads of Terms • 70% proceed • Buy-in from all parties • Legal and commercial Intensive ≅ 11 • Investment DD Committee • 90% proceed ≅ 10 Completion 3 – 6 months 4 – 8 weeks 8
Fees on Symvan Technology SEIS & EIS Funds • Zero upfront or ongoing fees for investors – Tax relief can be claimed on full amount of subscriptions • 20% Performance Fee on realised amounts at disposal in excess of subscriptions 9
Portfolio Performance • No failures • 2 pivots • 5/9 post-revenue • 1 EBIT positive • 32% average uplift in valuation across portfolio post follow-on funding • Aggregate follow-on funding exceeds initial investment 10
Portfolio Approach “Poor” Case • £100,000 invested equally across 10 companies during 16/17 tax year • Higher rate tax payer Company Performance Gross Net Net Proceeds at Distribution Investment Investment Investment Disposal (CGT) (non-CGT) (includes LR) 0 10x £0 £0 £0 £0 1 5x £10,000 £4,6000 £5,000 £50,000 0 2x £0 £0 £0 £0 0 0.5x £0 £0 £0 £0 9 0x £90,000 £36,000 £45,000 £20,250 10 £100,000 £40,000 £50,000 £70,250 75.6% 40.5% 11
SEIS Portfolio Approach “Base” Case • £100,000 invested equally across 10 companies during 16/17 tax year • Higher rate tax payer Company Performance Gross Net Net Proceeds at Distribution Investment Investment Investment Disposal (CGT) (non-CGT) 1 10x £10,000 £4,000 £5,000 £100,000 2 5x £20,000 £8,000 £10,000 £100,000 2 2x £20,000 £8,000 £10,000 £40,000 0 0.5x £0 £0 £0 £0 5 0x £50,000 £20,000 £25,000 £11,250 10 £100,000 £40,000 £50,000 £251,250 528.1% 402.5% 12
Portfolio 13
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