Highgate Tech Fund LLP

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Highgate’s fund overview

The ethos of the Highgate Tech Fund approach to investment represents the intrinsic sentiment behind the Enterprise Investment Scheme, being to foster and encourage private sector investment into growing British companies. The Highgate Tech Fund is a tax efficient fund issued under the Enterprise Investment Scheme which offers significant advantageous tax benefits to private individuals making investments into qualifying British companies. This Fund specifically takes advantage of innovative, disruptive, state of the art technologies that are coming to market place at an extraordinarily rapid pace. Tech, and in particular software investments afford many opportunities. The markets that we believe are very attractive continue to be the SaaS, mobile telecoms, applications for smartphones, social media and internet/web based products and services.

Highgate offers an innovative charging structure, i.e. we believe that our rewards should be in line with the successful delivery of results to Investors. This Investor Fee Free Fund is targeted at the Tech sector of the UK economy, where opportunities abound and fast moving technology developments provide accelerated growth potential for those investors swift and experienced enough to make good investment decisions quickly and get invested at the right stage of these companies’ development.

Highgate Tech Fund is advised by Enterprise Private Equity Limited, whose management team have a 20+ years successful track record in investing, managing and realising the proceeds from EIS Investments.

Where will the money be invested?

The Investment Committee will select investments in line with the Fund investment criteria set out below. These are likely to be in unquoted companies with clearly defined exit strategies. The Investment Committee seeks a balance of strong technologies and growth opportunities.

The Fund is a generalist fund, primarily investing in new technologies (primarily software) and applications, in high growth areas, such as web based, location based services delivered via mobile devices, mobile applications, cloud computing services, software as a service (SaaS) and internet related services.

A list of current investments under consideration is available from Highgate. There is no guarantee that any specific investment will be made until the formal due diligence process is complete.

Whilst unquoted companies are generally higher risk than traditional investments, the Fund management has both specific and successful track records in identifying exceptional opportunities and nurturing companies to achieve their potential. The Investment Committee looks to take a mid to long-term view when making investments as the EIS rules require investments to be held for at least three years.

The Fund will have a wide remit to invest in early stage companies and SMEs and in sectors that are positioned to benefit from strong growth trends driven by contemporary influences in our everyday life. These areas are characterised by strong and sustainable growth potential. The range of investee companies will naturally be diverse since there are many factors which impact on the economy and social trends.

The Fund is likely to invest in highly technical innovation and the Investment Committee will seek to invest in companies that have potential to generate revenue in the short term, and/or have a proven business model and are seeking additional development and growth capital. As a priority, new technologies will be sought across all sectors with particular emphasis in the creation and perception of branding and the exploitation of intellectual property.

Brief examples of current and potential future investments are set out below and further details are available separately from this document. These examples are intended to give a flavour of the types of companies that may be considered and there is no guarantee that all or any of these potential investments will be made.

Fund management process

Primary criteria: Without exception, the experience of the Investment Committee members over the extent of their respective investment histories demonstrates that there is one outstanding factor that ‘makes or breaks’ a successful investment – the management. The Fund will invest in companies that have strong, motivated and cohesive management teams with the appropriate skills set to deliver the business plan. Where there is a lack of skill, for example, a Finance Director or a need for sales resource, the Fund will appoint suitably experienced individuals who can add value to the investee company.

Stage of investment: The Investment Committee will be seeking investment opportunities in companies looking for additional development and growth capital, although they will consider exceptional situations provided that these can demonstrate real potential for revenue or a unique market opportunity. Additionally, the Investment Committee will be looking at companies which offer the opportunity to expand internationally, outside the UK, utilising many of the strengths, contacts and experience that Highgate professionals possess in order to ramp up the success of the business.

Exit strategy: Investee companies must be able to demonstrate that there is a clear route for exit. Whilst future developments cannot be controlled in advance, it is important that there is a strategy in place at the outset to deliver returns to Investors. The aim will be to distribute returns to Investors within a 3-5 year period, which may, in exceptional circumstances, be extended to 4 – 7 years in order to maximise exit values.

Exit before completion of the three year EIS qualifying period would prejudice the available tax reliefs so the Fund Board will not normally contemplate exit before this period has expired.

Examples of Highgate’s related investments

iVoucher

(already invested)

iVoucher is a unique and compelling solution that revolutionises the existing high growth voucher marketplace. Based on its class-leading voucher marketing software and a disruptive commercial model, iVoucher capitalises on the large and fast growing international voucher market opportunity. iV platformoucher is a self-service platform that uniquely provides merchants the opportunity to create and distribute vouchers to their existing customers and to acquire new customers. As a white label platform iVoucher appeals to many organisations wanting to take a voucher proposition to market to their own closed communities. In short iVoucher optimises Voucher marketing.

Ecometrica

(already invested)
Ecometrica is a market leading Carbon Accounting and Greenhouse Gas Accounting and Ecosystem Mapping business delivering Software as a service to FTSE 100 and Fortune 500 Companies. Founded in 2008 Ecometrica started life as consulting company with a team of leading climate change scientists providing carbon accounting services to large enterprise and government bodies. That experience has led to the development of three cloud based sustainability platforms working towards the goal to become the Bloomberg for environmental data. The team of 23 consultants, software developers and sales/marketing and support staff is based in Edinburgh and Montreal. Clients to date include RSA, Cable & Wireless, Greenergy, BP, Siemens & Petkim.

Adaptis Solutions

(already invested)
Adaptis delivers cashless payment solutions across Parking, Permit, Taxis, Buses, Boats, Trains and retail vendors through the advanced Dash Payment platform. Any business or individual can use Dash payments to provide another payment option.

Adaptis is the robust technology behind many cashless, text and NFC (near field communication mobile technology) based parking, ticketing and permit systems countrywide, providing a flexible and convenient way to make small and adhoc purchases. Adaptis is based in London and Liverpool, existing clients include First Capital Connect, LOCOG, Lambeth, Brent, Hillingdon & Southwark LA and more than 1000 London taxis.