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SFC's 2022: The Year in Review

Joseph Zipfel, Chief Investment Officer With a background in investment banking and a Master's from ESCP Europe, Joseph manages SFC Capital's investments, investor relations, and portfolio company fundraising strategies since 2014.
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SFC Capital’s 10th anniversary year: More funding, more exits and more SEIS!

2022 being our 10th anniversary year, we had to mark it with a bang and despite the tough economic environment, we made it a record-breaking year for SFC Capital!

The year started with British Business Investments extending its commitment to SFC Capital to £15m, which will allow us to invest in another 50 innovative regional companies across the UK over the next 2 years alongside our SEIS and EIS funds. Great news for the UK startup ecosystems in the regions!

We then had our busiest year to date: by the end of 2022, we will have invested over £16 million, including over £10 million from our SEIS fund, a new record for an SEIS fund!

In total, we have invested in more than 100 innovative early-stage companies across Fintech, Health, B2B Software, Green Tech, Robotics and Consumer. This includes 80 new startups raising their first funding round, showing that our commitment to support the UK's vibrant startup community is as strong as ever. This was thanks to the fantastic work of the investment team, who reviewed over 3,000 investment opportunities this year!

2022 was also the year of the coming of age for the Seed Enterprise Investment Scheme (SEIS), which has finally received the boost that it deserves

We had been lobbying for these increases for years and so we are incredibly pleased to see that both investors and companies will be able to take a greater advantage of one of the most generous tax incentives for startup investments in the world.

SEIS has been at the core of our model since its introduction in 2012, and this year we were incredibly pleased to win the Best SEIS Investment Manager of the Year Award – for the third year in a row! More than ever, our goal is to be the go-to fund for anyone looking to access the SEIS benefits, and we want to offer not only great performance but also excellent customer service to our investors. 

We were also pleased to return capital to our investors with the successful exits from Vortex (a clean tech company acquired by Marston Holdings) and Cliff.ai (an intelligence software business acquired by Gtmhub, now Quantive). These deals generated an average return of over 6x the original investment (over 10x including SEIS and EIS tax relief). These were great results in a year where exits were down overall in the market. 

We had many achievements to celebrate in the portfolio: Cognism was named in Deloitte’s UK Technology Fast 50 (the UK’s fastest-growing technology companies), Condense won the Hottest Web3 startup in Europe at The Europas Awards, no less than seven portfolio companies were selected in the highly competitive Tech Nation Upscale, Fintech and Applied AI programmes, and we saw portfolio companies closing six and seven-figure deals with the likes of Google, Citigroup, Dior, BT, ebay, McDonalds, the main UK supermarket chains, and many more!  

On the funding side, Petalite, Algbra, Swytch, Surgery Hero, Penny, Lunio and Condense all raised multi-million-pound funding rounds led by top European investors. This shows that capital is still very much available for the most ambitious, innovative companies that can prove that they have a solid business model.

We are particularly proud of the diversity of these companies – from Web3 to Heath Tech and Net Zero technologies - which reflects our strategy to back great British innovation across all sectors of the economy. We are excited to see what the future holds for these companies and the broader startup ecosystem in the UK.

The timing for investing in early-stage companies building world-changing innovations has never been better, as this type of investment is relatively unaffected by global macro trends affecting other markets. Particularly if you throw in the ever more generous SEIS tax benefits!

SFC Capital is proud to be at the forefront of this exciting and rapidly-growing sector, and we look forward to continuing to support the next generation of innovative UK startups in 2023.

Capital at risk. For professional investors only.

Past performance is not indicative of future performance.

Tax benefits are subject to individual circumstances. Subject to changes.

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DISCLAIMER:
SFC Capital Ltd (SFC) is an appointed representative of SFC Capital Partners Ltd which is authorised and regulated by the Financial Conduct Authority (‘FCA’) in the United Kingdom (FRN 736284). This website is intended for professional investors only; any reproduction of this information, in whole, or part, is prohibited. The content is for information purposes only and should not be used or considered as an offer or solicitation to purchase or sell any securities.

Investment in early-stage companies involves risks such as illiquidity, lack of dividends, loss of investment and dilution. Investment in SEIS/EIS eligible companies should be considered as part of a diversified portfolio. The availability of tax relief depends on individual circumstances and may change in the future. The availability of tax relief depends on the company invested in maintaining its SEIS/EIS qualifying status. There is no assurance that the investment objectives of any investment opportunity will be achieved or that the strategies and methods described herein will be successful. The investment products cited herein may place capital at risk and therefore investors may not get back the full amount invested. Past performance is not necessarily a guide to future performance and the value of an investment may go down as well as up. Investors may not get back the full amount invested. Companies’ pitches for investment are not offers to the public and investments can only be made by members of SFC Capital. SFC Capital takes no responsibility for this information or for any recommendations or opinions made by the companies. Neither SFC Capital nor any of its employees provide any financial or tax advice in relation to the investments and investors are recommended to seek independent financial and tax advice before committing. This website is not directed at or intended for publication or distribution to any person (natural or legal) in any jurisdiction where doing so would result in contravention of any applicable laws or regulations. No warranties or representations of any kind are expressed or implied herein. This material is confidential and is the property of SFC Capital.

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