Small business investments via EIS scheme at record high

Over 3,000 UK small enterprises raised finance through EIS last year, an 11% hike on previous years

The number of investments made into UK small businesses through the Enterprise Investment Scheme (EIS) rose by 11% in 2014 to 2015 from 2013 to 2014 – setting a new record – according to a report by Radius Equity.

135,445 investments were made in the 2014/15 period, compared to just 122,320 in 2013/14.

The number of companies raising funds via EIS has also risen, jumping by 10% from 2,820 to 3,130 in the last year.

The EIS scheme is designed specifically to encourage investment into the UK’s smaller enterprises, and is currently one of the only government- supported tax break schemes available.

See more: The Enterprise Investment Scheme (EIS) explained

Gary Robins, director at Radius Equity said:

“It’s clear by the increasing numbers of investments made through the scheme year on year that small businesses that are EIS compliant are very attractive investment opportunities for high earners. Crowdfunding has helped raise the profile of the scheme for those affluent investors looking for investment opportunities with competitive returns.

“Small business play a vital role within the UK economy so it’s important that they have access to the funding they need. With the traditional forms of lending often closed to small businesses, they are increasingly looking for alternative ways to attract this investment.

“By funding these small businesses through the EIS scheme, allowing them to expand into new markets and create jobs, investors are in turn, helping to drive wider economic growth throughout the UK.”

Are looking to raise investment through EIS? Here are 7 pitfalls you need to avoid.

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