Great Point Ventures EIS Fund

Great Point Media Group is a specialist asset management business that operates exclusively within the media sector. The business is engaged in a wide range of activities from financing high-quality television and film projects to advising on international distribution strategies and providing finance to early-stage creative businesses. 

The group employs a team of 15 senior investment professionals who have over 150 years of cumulative experience in the sector and over 400 film and television credits.

Great Point used to offer an EIS service under previous EIS/SEIS rules and has £170 million within these investments. 

The new Great Point Ventures EIS Fund, launched in 2018, invests in the UK creative industry. Its focus is not only on the creation of media and entertainment content, but also on its distribution, production, and new media technologies. Great Point aims to back media businesses with attractive intellectual property (IP) that it believes can generate attractive returns (not guaranteed).

Important: The information on this website is for experienced investors. It is not advice nor a research or personal recommendation to invest. If you’re unsure, please seek advice. Investments are for the long term. They are high risk and illiquid and can fall as well as rise in value, so you could get back less than you invest.

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Highlights

  • Invests in the UK creative media and entertainment sector
  • Four key areas covered: content creation, distribution, production and new media
  • New fund from a highly experienced and well connected media group
  • Target return 2x (excluding tax relief) with the aim to achieve an exit in 4-6 years, not guaranteed
  • Minimum four portfolio companies (not guaranteed) with advance assurance
  • Investments should be deployed within 18 months, not guaranteed
  • Minimum investment £10,000

The manager

Great Point Media Group is a specialist asset management business that operates exclusively within the media sector. The business is engaged in a wide range of activities from financing high-quality television and film projects to advising on international distribution strategies and providing finance to early-stage creative businesses. 

The group employs a team of 15 senior investment professionals with over 150 years of cumulative experience in the sector.

Great Point’s management team has first-hand knowledge of the financial, operational and commercial aspects of the sector. As an example, one of the directors, Robert Halmi, was CEO of four publicly listed entertainment conglomerates and served as Chairman of Crown Media, Inc. where he founded the US television network Hallmark Channel, which now broadcasts to over 80 million homes. Other members of the team are also very experienced.

Great Point Media backs high-quality television films, series, and mini-series – indeed it has over 400 production credits in film and TV. Recent projects include Line of Duty series 3 and 4, The Cry, starring Jenna Coleman, and Manhunt, starring Martin Clunes. Its projects have featured on UK broadcast television, US cable networks, online streaming services and at world-class film festivals. 

The manager of the EIS fund, Great Point Investments Limited (“GPI”), is a subsidiary of Great Point Media Group. 

Great Point Investments has £174 million in assets under management across its EIS and SEIS mandates. £4.4 million has been invested through its new Ventures EIS offering. 

Investment strategy

The Great Point Ventures Fund aims to invest in creative businesses. A content creation company is an obvious candidate for investment, the fund will also invest in content distribution and marketing, production facilities and services, as well as new media and technology.

Importantly, the fund will not finance specific film projects, as was typically the case with media EIS offers previously.

Target companies must have the potential to address large new markets or disrupt existing ones and should be led by entrepreneurial teams with a proven track record.

Intellectual property is key. This is where much of the value lies in the film and TV industry. The media rights to a successful TV series can be sold on and on.

The target return is 2x after tax relief, and not guaranteed. Potential exit routes include trade sales, management buyouts, IPO or a combination. Please note, exit options and timeframes are not guaranteed.

Content creation

The UK content sector is growing rapidly with more than £3.6 billion spent on productions in 2019 alone. The fund looks for content creation businesses in filmed entertainment, gaming and music. The remit is nationwide, not just London. Indeed, companies from the “Nations and Regions” can be attractive because Ofcom, the regulator, imposes quotas on Public Service Broadcasters to ensure a proportion of programmes are made in the UK outside the M25. 

Content distribution and marketing

The fund will also invest in businesses that distribute and market content. It believes local distribution and marketing play an important part in monetising content.

Production facilities and services

The UK is an attractive place to produce, thanks to its tax credit incentives and skilled UK crews. The fund will look at studio facilities, post-production and visual effects businesses as well as providers of specialist equipment.

New media and technology

The fund will also consider investments in emerging tech and media startups, operating in sectors such as gaming, apps, VR (virtual reality) and AR (augmented reality).

Target companies must have the potential to address large new markets or disrupt existing ones and should be led by entrepreneurial teams with a proven track record.

Intellectual property is key. This is where much of the value lies in the film and TV industry. The media rights to a successful TV series can be sold on and on.

Target return

The fund targets a return of 2x (before tax relief) after four to six years. Returns and timeframes are not guaranteed. 

Exit strategy

The fund aims to deliver investors’ returns through either a sale to third parties, management, other shareholders or another investment fund following a period of at least four to six years from when the investment was made in each company – not guaranteed. 

Portfolio

The fund has invested £4.4 million across nine investments since launching in 2018. 

Below are portfolio company examples from previous iterations of the fund. They are outlined to give a flavour of the types of companies you might expect but are unlikely to be part of a new investor's portfolio. 

Littledoor Productions – Great Point MediaLittledoor Productions Limited (creative content)

Based in Cardiff, Littledoor Productions is an independent film and TV production company.

The company was founded by Elwen Rowlands and Hayley Manning. The pair have substantial experience in the industry, having worked with a range of broadcasters and financiers for over 20 years. Some of their credits include Doctor Who, Life on Mars, and BBC One’s high-end period drama, The Last Post. 

While the company will focus on delivering projects for the international market, it will also aim to invest in talent locally, helping provide an “authentic voice” to its creations. 

Despite having only launched in 2019, the business has already secured its first series production and filming is currently underway. The project was commissioned by BBC Cymru Wales and will be distributed by Lionsgate. 

GPI invested into the company in August 2019. The funding will be used to scale the business and enable the development of future projects. The business is now revenue generative and expects to become profitable by year-end – not guaranteed. The investment is currently held at cost.

Looper Insights – Great Point Media EISLooper Insights Limited (future media and technology)

Looper Insights provides Software-as-a-Service (SaaS) technology to help film and TV companies grow their VOD (video on demand) revenues and manage their brands.

Looper offers a single interface to track film and TV titles, alongside merchandising and promotions, across transactional stores and markets. The company aims to deliver a 10% increase in client sales by ensuring vendors of media content have the best product, page, price, placement, promotion and therefore performance on all available platforms.

Great Point invested in April 2019. The capital raised by the company will be used to scale the business and accelerate the development of Looper Insights into other areas such as the theatre, ebooks, video games and music.

McKellen: Playing the Part (example of previous failure)

As is to be expected, not all investments will work out. One such investment was held in a previous Great Point SEIS fund (made under older rules but where there was significant risk to capital).

Great Point invested, via its Select Media SEIS 6 fund, in a film called McKellen: Playing the Part. This was a documentary about Sir Ian McKellen, starring the actor himself. The film had access to private photo albums, a wealth of archive material, childhood diaries, and exclusive behind the scenes of theatre shows and films. However, the sales market was not as strong as initially anticipated, despite the film receiving critical acclaim. Whilst the project could generate further income over the longer term, the investment was partially written down to reflect its initial sales performance. 

Performance 

The Great Point Ventures fund launched in 2018 and thus has a limited performance track record. 

The chart below shows the average performance of the total subscribed into the fund each tax year, based on valuations as at 16 October 2020, expressed on a £100 invested basis. Please note, individual investor portfolios’ performance will deviate from the average.

Source: Great Point Investments, as at 16 October2020. Performance figures are supplied by Great Point Investments and are net of all fees, based on Fuel Ventures’ valuation methodology. Past performance is no guide to future performance. These figures do not include any realised returns (exits) as there have not been any. In the above examples, initial tax relief of up to 30% could also apply. So, for the tax year 2018/19, the total return including initial tax relief would be £139 – remember tax rules can change and tax benefits depend on circumstances.

Risks – important

This, like all investments available through Wealth Club, is only for experienced investors happy to make their own investment decisions without advice. 

SEIS and EIS investments are high-risk so should only form part of a balanced portfolio and you should not invest money you cannot afford to lose. They also tend to be illiquid and hard to sell and value. Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks. 

Tax rules can change and benefits depend on circumstances. 

This EIS fund invests in early-stage businesses which are more likely to fail than larger ones. So you should expect a number of failures in the portfolio, or even be prepared for all companies to fail.

This is a relatively concentrated portfolio of unquoted media companies. This is a competitive market and the companies may not produce the desired returns. There is limited diversification and the total return could be adversely affected by the poor performance of a small number of portfolio companies.

Charges

A summary of the main charges and savings is shown below. The net initial charge shown includes the Wealth Club saving and any early bird discount. The investment may have additional charges and expenses: please see the provider documents including the Key Information Document for more details.

Investor charges
Full initial charge 2%
Wealth Club initial saving
Net initial charge through Wealth Club 2%
Annual management charge
Administration charge
Performance fee 20%
Investee company charges
Initial charge
Annual charges 2.625%
All fees and charges are stated exclusive of VAT, which may be applicable in some cases. Any fees and charges payable by the investee companies or the underlying businesses do not directly come out of your investment. However, they will effectively reduce the returns generated by investee companies and therefore impact your investment.

More detail on the charges

Timing of the offer

The fund anticipates taking up to 18 months to fully deploy investor capital following the closing dates. However, it may take longer.

Our view

The fund invests in a range of activities within the UK creative content industry: a market that is growing rapidly. The team is very experienced and has a strong network in the media industry. 

It is important to note the majority of Great Point’s experience in EIS was made under old rules, which allowed project financing. This is Great Point’s first growth-focused EIS fund. However, the fund benefits from its association with the wider media group, which provides both an experienced team of investment professionals, as well as the potential for enhanced deal flow through the group’s wider network of industry contacts.

Wealth Club aims to make it easier for experienced investors to find information on – and apply for – tax-efficient investments. You should base your investment decision on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice or a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.

The details

Type
Fund
Sector
Media
Target return
2x
Funds raised / sought
-
Minimum investment
£10,000
Deadline
Discretionary
Last updated: 9 December 2020

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