Longbow Capital launches EIS
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Longbow Capital, a specialist venture investor, has launched a fund investing in emerging healthcare, life science and wellbeing companies.
The Enterprise Investment Schemes (EIS) will invest in a portfolio of six to eight companies within a 12-month period.
According to Longbow Capital, the current economic environment is “ideal for investing in this asset class and sector”. This is because valuations have fallen owing to shortages of venture capital available. (article continues below)
Longbow Capital is a founding partner of the Boots Centre for Innovation (BCI), an innovation hub that works with early stage companies or inventors to develop products for the shelves of Alliance Boots stores.
Julian Hickman, a partner at Longbow Capital, says the fund gives investors access to investment prospects that emerge from the BCI as well as other sources.
In a statement, Hickman says the relationship with Boots ensures that these products have access to a distribution network.
Longbow Capital is aiming to raise £10m for the new vehicle
The fund, which will be invested by the Longbow executive team, comprises of Edward Beckett, Robin Finlayson, Julian Hickman, Ron Petersen and Edward Rudd.
The minimum investment is £10,000. Investors pay an upfront charge of 5% and a management fee of 2%. Longbow Capital is aiming to raise £10m for the new vehicle. The fund closes to new investments on April 1, 2010.
Under the EIS investors could qualify for 20% income tax relief on up to £500,000 in any one tax year or tax free capital gains if held for three years. They may also qualify for a deferral of capital gains generated up to three years before or one year after the EIS investment or 100% inheritance tax relief if held for two years.
Whether investors qualify for tax relief depends on their tax status.
