KickStart Capital / EIS.Marketing Ltd
Whilst COVID-19 has had an impact on all businesses, we are pleased that KickStart Capital / EIS.Marketing has continued to operate and help its clients through these challenging times. Although some of the team have been working remotely periodically, we have tried to maintain our usual high standards of service throughout the pandemic and we continue to do so on an ongoing basis.
In terms of EIS / SEIS, as covered in the summary below, there was naturally a downturn when the the pandemic started. Unfortunately, to make things worse, the start of the pandemic coincided with both the launch of our KickStart Capital Platform and the end of the 2019 / 2020 tax year, a time when the EIS market is traditionally at its busiest. Additionally, we had another lockdown at the end of the 2020 / 2021 tax year. These issues have meant that whilst we have had various interesting opportunities listed on our Platform for a while, until recently, they have not been actively marketed, as there has been less appetite to invest in EIS during these challenging times.
On a positive note, following the lifting of most COVID restrictions, although there are still concerns over different COVID variants, things are at last, looking more positive and there is some general confidence coming back to the country. Indeed, with the UK vaccine and ongoing booster programme continuing to progress well, things are starting to pick up and we are starting to see some real traction behind some of the opportunities on the KickStart Capital Platform as well as in the market more generally.
COVID-19 & EIS / SEIS
Coronavirus has had a major impact on everyone and there can be little doubt it has hit the EIS sector too. Many investors took risk off the table, at least in the short term, therefore reducing the funds flowing into EIS and indeed this has been similar across many other investment sectors too. This has not been helped with general global uncertainty / conflicts and challenging economic times.
Fortunately, whilst there are still ongoing concerns, particularly over different COVID variants and also the general impact of COVID, as mentioned above, there is hope that the worst of the pandemic is behind us. This is mainly due to the rapid development of several vaccines and the COVID-19 vaccination and ongoing booster programme making some real progress in the UK and in many other parts of the globe. This has created a new hope, which combined with some really interesting EIS opportunities, has led to renewed interest in the EIS sector.
By their very nature, EIS companies are often dynamic and innovative companies. In this respect, many EIS have adapted their business models to deal with the challenging markets we have been experiencing and in many cases to take advantage of new opportunities brought about by COVID-19. Many EIS are also well placed to take advantage of opportunities as we continue to see many of the various COVID-19 restrictions (mandatory and voluntary) lifted and we hopefully leave the worst of the pandemic behind us. Additionally, there are many positive steps being taken by both the industry as a whole and the EISA and some of these steps could be positive for EIS investors in the long run.
Like any investments there are both risks and rewards associated with investing in EIS, but unlike most investments there are valuable tax reliefs available to EIS investors. These tax reliefs can both reduce the effective cost of investment and also provide many longer term potential benefits - particularly important in these uncertain times.
Another benefit EIS have in times of uncertainty, is that they are generally uncorrelated to most traditional investments.
Besides specific EIS benefits such as the various EIS tax reliefs, there have also been many general support schemes / grants and other initiatives that have been announced by the government and indeed continue to be announced. These aim to help British companies cope with the issues caused by COVID-19, and to encourage the development of innovative solutions to help deal with both the direct impact of COVID-19 and also the wider impact it has on business and the everyday lives of individuals. Whilst these are not EIS specific benefits, there are EIS companies that are well positioned to potentially take advantage of some of these initiatives.
The Future
Nobody knows what the future holds for EIS or indeed for any investments in these uncertain times. However, whilst things have been slower than usual in the EIS market, there is a general belief that things are picking up now. Indeed, for investors looking at EIS, there are some really exciting opportunities available and now is potentially a very good time to explore these opportunities.
Please have a look around KickStart Capital and some of the current opportunities listed. If you need anything or have any queries, please feel free to contact us.
