The British Design Fund 3 (the "Fund") invests in and provides support for UK product design and manufacturing companies. The UK has the second-largest design sector in the world and is home to one of the largest design industries in Europe .
Funding for UK product design and manufacturing companies often comes from a combination of innovation grants and awards, friends and family, bank facilities and product crowd funding platforms. As a result, the Fund has identified a funding gap and will provide capital for companies which seek to deliver outstanding product design innovation and manufacturing.
The focus of the Fund is to invest in UK based early-stage companies that seek to lead the market in provision of innovative product design and manufacturing. The Fund seeks to invest at least £100,000 in each Investee Company in return for circa 15% to 30% equity, across at least five companies.
Due to lack of investment options available to companies in the innovative product design and manufacturing sector, the Fund will seek to select the most attractive opportunities and pre-money valuations. Investors will gain access to unique deal flow and the Fund will seek to de-risk investments through pre-money demand validation.
The Investment Manager (with the research assistance of the Company Mentor) will seek to identify potential Investee Companies, which it believes will have the following key criteria:
The Fund will be managed by the Investment Manager. Each investment will be mentored by the Company Mentor to ensure optimum cross-fertilisation across all the Investee Companies.
The duration of each investment will be managed by focusing on companies where the Company Mentor can affect the rate of business development and the resulting cash flow growth. This aims to ensure best use of capital to enable growth and prepare each Investee Company for acquisition or a potential listing.
The expected holding period of most investments will be between the minimum three years for tax conditions and a targeted maximum of six years. However, it is noted that Investee Companies may be held for longer or shorter periods.
The Sapphire Capital Partners LLP team have extensive experience within the alternative investment sphere and act as Investment Manager to several EIS Funds. They have also won several awards within the industry including: Winner, Best Individual - rising star in EIS and SEIS (Boyd Carson, 2016 & Vasiliki Carson, 2017), Highly Commended, Best EIS/SEIS Tax Adviser (Sapphire Capital Partners LLP, 2017) and Winner, Best Company - innovation, newcomer or rising star in EIS and SEIS (Sapphire Capital Partners LLP, 2017).
The British Design Fund is supported by a team with strong retail, product and investment experience which gives it access to valuable sector specific expertise in order to research, identify, invest in and help to accelerate early stage UK based companies in the product design and manufacturing sector.
The team consists of:
Damon Bonser: Damon is a serial entrepreneur with over 14 years’ experience of building and running product design and manufacturing businesses.
John Mathers: Former CEO of the Design Council with forty years’ experience in the brand and design industry, across retail, FMCG, and consultancy.
David Kremer: David has over 25 years ‘experience running Seven Towns, a multimillion toy and game business, and is the co-founder of Rubik’s Brand Limited.
David Motum: Over 30 years David has built up two businesses within the financial publishing and media sector, namely; MSM International Ltd, and MSM Media.
For more information visit britishdesignfund.co.uk
5% of the amounts invested into each investee company
Between 2-4% of the amounts invested in each investee company
On any increase in value on an individual investment in an Investee Company up to £5 above a hurdle rate of £1.05 (for every £1 invested) a performance fee will be charged of 20% (it is noted that the 20% will be split 5% to the Investment Manager and 15% to the Company Mentor) on the amount of the increase over and above £1.05 up to £5, and; On any increase in value on an individual investment in an Investee Company over £5 (for every £1 invested) a performance fee will be charged of 25% (it is noted that the 25% will be split 6.25% to the Investment Manager and 18.75% to the Company Mentor) on the amount of the increase over and above £5.
It is noted that no performance fee will be charged on any amounts below the hurdle rate of 5% (being £1.05 for every £1 invested).
To the extent that the performance fee is not paid by the Investee Companies, Investors shall be liable for their share of such fee and the Custodian may be instructed by the Investment Manager to transfer cash in an Investor’s portfolio to the Investment Manager and Company Mentor to satisfy any outstanding performance fee.
Any reasonable arm’s length expenses and/or transaction fees incurred by the Investment Manager in managing the Fund and/or by the Company Mentor in assisting the Investment Manager or Investee Companies shall be reimbursed by Investee Companies.
The fees and charges described above are exclusive of VAT which will be added where applicable To the extent that the performance fee is not paid by the Investee Companies, Investors shall be liable for their share of such fee and the Custodian may be instructed by the Investment Manager to transfer cash in an Investor’s portfolio to the Investment Manager and Company Mentor to satisfy any outstanding performance fee.
The fees and charges described above are exclusive of VAT which will be added where applicable
Alternative Investment Fund
£3 for every £1 invested
Equity EIS
Product design and manufacturing
Minimum five companies
Woodside Corporate Services Limited provides both custodian and nominee services
An investor qualifies as an High Net Worth investor if they have
(a) An annual income to the value of £100,000 or more;
(b) Net assets to the value of £250,000 or more. Net assets for these purposes do not include:
(i) the property which is their primary residence or any loan secured on that residence;
(ii) any rights under a qualifying contract of insurance within the meaning of the Financial
Services and Markets Act 2000 (Regulated Activities) Order 2001; or
(iii) any benefits (in the form of pensions or otherwise) which are payable on the termination of their service or death or retirement and to which they are or (or their dependants are), or may be, entitled.
An investor qualifies as ar Self-Certified Sophisticated Investor if at least one of the following applies:
a) they are a member of a network or syndicate of business angels and have been so for at least the last six months prior to the date below
b) they have made more than one investment in an unlisted company in the two years prior to the date below
c) they are working, or have worked in the two years prior to the date below, in a professional capacity in the private equity sector, or in the provision of finance for small and medium sized enterprises
d) they are currently, or have been in the two years prior to the date, below a director of a company with an annual turnover of at least £1 million