Deepbridge Technology Growth EIS

The Deepbridge Technology Growth EIS invests in precisely the kind of knowledge-intensive companies the government wants for EIS investment – and has been doing so for years. 

Highlights

  • Technology-focused EIS fund
  • Invest in a portfolio of selected companies with high growth potential 
  • Experienced management, who are required to invest their own money in the offer
  • Pay no initial charge through Wealth Club
  • £10,000 minimum investment

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.

Read important documents and apply

The offer

This EIS is evergreen and is continually seeking investors’ funds. It invests in later-stage, growth-orientated technology companies. 

Deepbridge targets businesses in three key sectors: energy and resource innovation, medical technologies, and high-growth IT-based technologies. 

Investee companies must have significant market potential. Ideally they should be already in the process of commercialising the product or service they’ve developed and have identified revenue streams. They should own robust intellectual property or a patented product, which can provide some value if the business doesn't work out. 

Watch an exclusive video interview with Deepbridge managing partner Ian Warwick:

Recorded 16 October 2018

Portfolio company examples

Algaecytes – Deepbridge Technology Growth EIS-min.jpgAlgaeCytes

AlgaeCytes has developed a patented process that exploits freshwater algae grown in controlled conditions to produce Omega 3, biomass rich in proteins and clean water, leaving no waste. AlgaeCytes thus benefits from two sources of revenue: the treatment of water discharged from industrial process and the production of Omega 3, currently largely produced from a limited and depleting fish population. AlgaeCytes is in negotiations with a number of large corporations involved in food, drink or healthcare products markets. In October 2017 it upscaled its production facilities, allowing it to increase production ten-fold and meet the needs of larger clients. 

Connect Childcare – Deepbridge Technology Growth EISConnect Childcare Group

Connect Childcare Group Ltd has developed a suite of innovative nursery management software systems for the childcare sector, which aims to enable childcare staff to spend more time with the children in their care whilst simultaneously bringing parents closer to the development of their own children. Connect Childcare offers a range of resource solutions suited to the varying needs of single-site nursery operators to the larger multi-site organisations.

The manager

Deepbridge Capital was set up by Ian Warwick. Initially he intended to launch an unquoted growth technology fund. However, after the rules changed to allow investments of up to £5 million in an individual company, he considered EIS more appropriate.

Mr Warwick has had a varied career: he was in the Royal Navy, then an oil engineer in Houston and worked for one of the biggest printer companies before settling on technology start-ups in New York. When he founded Deepbridge, he didn’t have experience of managing money but he and his founding partners all had experience in technology and in listing and floating businesses.

Deepbridge’s investment team is required to invest their own money in the portfolio companies. If the portfolio loses money, they lose money, so there’s an added incentive to apply a tight investment selection process and help businesses achieve their objectives.

Target return

The portfolio aims to deliver a return of £1.60 for every £1 gross invested over three to four years. Please note though: returns are not guaranteed. Capital is at risk and you could get back less than you invest. Moreover, tax benefits depend on circumstances and tax rules can change.

Exit strategy

Before Deepbridge invests, it tries to identify potential buyers for investee companies, but there is no set exit strategy and timeframes are unknown.

Risks – important

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

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.

Fees and charges

A summary of the fees and charges is shown below. Please see the provider's documents for more details.

Full initial charge 2%
Wealth Club initial saving 2%
Net initial charge through Wealth Club 0%
Annual charge 2%
Performance fee 20%

More detail on the charges

Our view

This is an interesting, albeit higher-risk EIS offer. The core team comes with many years of experience in investing in, managing and floating businesses.

Read important documents and apply

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
Technology
Target return
1.6x
Funds raised / sought
£14.0 million raised
Minimum investment
£10,000
Deadline
Discretionary
Last updated: 6 April 2019

News about Enterprise Investment Scheme. Read all