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.