Record EIS fundraise: £3 million in 34 days
Archived article: please remember tax and investment rules and circumstances can change over time. This article reflects our views at the time of publication.
On paper, everything conspired against this offer.
Traditionally, investors are not particularly active in the summer. As the old adage goes, ‘Sell in May and go away, come back again on St. Leger day’.
In addition, this offer opened in quite possibly the worst week of the summer: soon after the heatwave started and in the middle of the football World Cup.
Yet, just 34 days after it opened, it is oversubscribed. 126 clients, including me and several of my colleagues, have invested a total of just over £3,000,000 in the Acamar Films EIS.
Acamar Films is the company behind the BBC CBeebies number one preschool children’s show, Bing. Investors were able to invest mid-stream in an already successful concept with significant further growth potential.
This is quite uncommon. Usually, if a concept has been proven, private investors don’t even get a look in. However, there are exceptions.
Proven concept with further growth potential
Acamar Films EIS is an example. Another, in a completely different sector, could be Firglas Ltd EIS, which is still open for investment.
The company is raising money to fund two plants that will produce protein from microalgae on a commercial scale.
The concept is proven. Over the last five years, Firglas has been trialling a system in the Netherlands. Now it believes it has reached the point its trial system can be rolled out and production scaled up.
But is there really a global demand for algae?
By 2050 the world population is estimated to consume two-thirds more protein than we do today. Alternative protein sources, such as microalgae, will need to pick up some the slack of slowing meat and seafood growth.
Indeed, food giants from Nestlé to Danone, as well as investors such as Bill Gates and Richard Branson, are already backing alternative protein projects.
Surprisingly, algae can contain up to 65% protein, three times as much as beef – as well as other essential nutrients.
Because of that, microalgae could make a great ingredient for fish feed. Typically, fish farms feed fish with fishmeal. Algae-based fish feed could provide a nutritious and more sustainable alternative. It is also estimated to be 60% to 70% cheaper to produce. The fish feed market is large enough to be attractive – it’s worth $42 billion.
But that could potentially just be the tip of the iceberg. Algae ingredients could have a multitude of uses – from cosmetics to food supplements.
It is difficult to get reliable figures on the size of the markets that can be addressed by microalgae. The former CEO of Heliae Technology Holdings, a company commercialising algae production and part-funded by the Mars family, puts it in the trillions of pounds.
And this is the market that Firglas Ltd EIS wants to tap into.
There is the potential for significant rewards, but there are also significant risks and no guarantees, so this offer should only be considered by experienced investors.
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