Scottish Enterprise & The Scottish Investment Bank: Supporting SMEs in Scotland

Scottish Enterprise: Scotland’s main economic development agency: 1000 staff across Scotland Close links with government Delivering economic growth by: Attracting inward investment Business infrastructure development Growing indigenous companies by providing: –Account management and grant support; –Innovation and Commercialisation support; –Investment through the Scottish Investment Bank

Scottish Investment Bank - summary position Established in December 2010 Operates on a Scotland-wide basis A Division of Scottish Enterprise No banking Licence operates under an Exception from FMSA 2000 Capital base from SE/HIE/SG/ERDF Invests between £20m - £30m p.a.

Scottish Investment Bank – a division of Scottish Enterprise Remit - To support Scotland’s economic development by growing Scotland’s private sector funding market to ensure that both early stage and established SMEs with growth and exporting potential have adequate access to growth capital. Target Market - Growth potential and export based SMEs (of which there are currently about 15,000 in Scotland). Rationale - Addressing specific market failures/significant market gaps in the growth capital market for this cohort of companies where intervention will have a demonstrable positive impact.

Develop Scotland’s SME funding market by Growing the investor base: Develop, grow, and professionalise angel syndicates. Bringing in new private investors, both local and international; Angels (via LINC), VCs, Corporates. Increasing the money supply: Introducing new investment funds; Accessing ERDF: £100m for 3 funds ( ); Raise private sector institutional funding Increasing the demand for money: Financial readiness advice

Financing growth £250k £2m £5m £15m Seed Stage SSF Development & Expansion Stage SVF Early Stage SCF Maturity SLF

Investment Funds Partners introduce deals to SE to be matched subject to diligence and negotiation. £500k - £2m£2m - £10mScottish Venture Fund Partners are vetted, the SCF will match all qualifying investments from registered partners subject to eligibility. £100k - £1m£200k - £2mScottish Co- investment Fund Targeted at early stage deals, external investors usually required, debt and equity options. Up to £250kUp to £500kScottish Seed Fund Key Features Participation Amount Transaction Size Maximum transaction size £500k £2m £10m SCF Up to £1m SVF Up to £2m SSF Up to £250k

Investment Approach Equity investments Fully Commercial Equal rights Co-Investment Private sector investors apply to become co-investment partners Diligence process Formal co-investment partnering agreement Private sector Partners bring deals to Funds Private sector makes investment decisions

Investment Criteria  SME focus (headcount <250, turnover <€50m, b/s total <€43m)  Significant operational presence in Scotland  Restricted activities  Public sector contribution must be 50% or less  Percentage shareholding < 30% pre dilution  Viability

SCOTTISH INVESTMENT BANK - Investing in Innovative Scottish Companies

Co-investment Partners CORPORATES Channel 4 Mitsubishi UFJ Capital Murray Capital Siemens Technology Accelerator Scottish & Southern Energy Statoil Hydro Venture STV UKSE Fund Managers Wideblue VCs Evolve Capital FinTech Global Capital Herald Ventures Imprimatur Capital Kapital Ventures Exomedica Kenda Capital MMC Ventures Nauta Capital NBGI Ventures Noble FM Pentech Ventures Quayle Munro PUK Ventures Sigma Technology Group Symphony Equity Tate & Lyle Ventures VCs ACT Venture Capital Aescap Ventures Amadeus Capital Atmos Ceres Finance Albion Ventures Adamant Ventures Close Growth Capital Delta Partners Discovery Investment Fund ED Capital Ltd Emerald Technology Ventures Energy Ventures E-Synergy Ltd ANGEL SYNDICATES Alida Capital International Archangel Informal Investments Ltd Ashleybank Investments Ltd Aurora Private Equity Ltd Barwell plc Braveheart Ventures Ltd Capital Angels Investments ChimeraBio Highland Venture Capital London Capital Finance Longbow Capital Par Equity Pre-X Capital Sir Tom Farmer Souter Investments Tricapital

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