Fuel Ventures SEIS Fund
You are now able to apply
Please read all the offer information first
Fuel Ventures was set up and is run by Mark Pearson, founder of MyVoucherCodes, the online voucher code business. Since 2013, Fuel Ventures has invested more than £130 million into over 100 companies.
The SEIS Fund follows a similar strategy to Fuel Ventures’ EIS funds – to back fast-growing Software as a Service (SaaS) businesses, online platforms, and marketplaces – but at a much earlier stage.
Since launching its first SEIS fund in January 2021, Fuel has made £10.7 million of SEIS investments, currently valued at £11.2 million (30 April 2023). Past performance is not a guide to the future.
- Target return 5x over 10 years – high risk and not guaranteed
- Targets 10-40 companies
- Minimum investment £20,000 – you can apply online
- Next targeted deployment: in 2024/25 tax year, deadline 15 December 2023
Fuel Ventures was founded in 2013 by successful entrepreneur Mark Pearson. He had previously founded online voucher code company, MyVoucherCodes, sold as part of parent company Markco Media for a reported £55 million. Whilst running MyVoucherCodes, Mark made personal investments in nine early-stage technology and software businesses. Fuel Ventures was born as a result of his experience with these businesses.
Since its inception, Fuel has invested over £130 million into more than 100 companies – typically early-stage marketplaces, platforms and SaaS businesses – across its three funds: the SEIS fund, Follow-on EIS Fund, and the Scale-Up EIS Fund.
Fuel Ventures has 24 full-time staff. There are seven investment professionals: three dedicated to EIS and four to SEIS. Both investment teams are overseen by Mark, who has the final say on investment decisions. An independent advisory committee adds challenge and rigour to the investment process. In addition, a fundraising team helps raise capital both for Fuel’s funds and its portfolio companies, whilst a talent team assists founders with hiring.
Mark has historically invested between 5%-10% into each SEIS fund and has committed up to 5% in the current iteration.
Fuel Ventures is the investment advisor to the fund. The investment manager is Sapphire Capital Partners LLP.
Before your subscription is invested, the cash will be held by the custodian, Mainspring Nominees Limited. Shares will be held by the nominee, MNL Nominees Limited.
What is the difference between the Fuel Ventures funds?
Fuel Ventures operates three funds, one SEIS and two EIS, each targeting investments in young digital businesses at different funding stages.
- The Fuel Ventures SEIS fund invests in very early‑stage pre-seed funding rounds
- The Fuel Ventures Scale‑up EIS fund invests in early-stage companies between Seed and Series A funding rounds, which could include deal flow from the SEIS fund
- The Fuel Ventures Follow‑on EIS fund seeks to provide follow-on funding to what the manager considers to be the strongest performing companies from the SEIS and Scale‑up EIS funds. Fuel Ventures can also use its discretion to invest in new companies it believes are attractive.
The SEIS Fund follows the same core investment strategy employed across the Fuel Ventures EIS funds, albeit at an earlier stage. It invests in digital businesses Fuel Ventures believes have the potential to scale globally and are managed by exceptional founders. It seeks marketplaces, online platforms and SaaS companies. Fuel Ventures considers these businesses attractive as they tend to be easily scalable, have low costs per unit sold and, once a product generates revenue, typically growth is limited only by market demand, not by the ability of the business to supply it.
Fuel Ventures aims to create value for investors by taking a hands-on approach, using its sector experience to help companies build products and services people want and need, and expand internationally. Note that as the number of companies backed by Fuel Ventures increases each year, any potential added value may be diluted without continued expansion of the team.
Fuel Ventures’ SEIS Fund seeks to invest at the “pre-Seed” stage, with the potential of supporting investee companies with follow-on investments through its established EIS funds.
Fuel Ventures’ hands-on support, combined with its ability to invest at an early stage and follow its money, may help attract the best entrepreneurs, who often have a pick of potential investors. This may provide the SEIS Fund, and subsequently the later-stage EIS funds, with enhanced deal flow, although this is not guaranteed.
Given the high-risk nature of SEIS investing, Fuel Ventures aims to build a diversified portfolio.
In the current tranche of the SEIS fund, investors are expected to receive a portfolio of at least 10 and up to 40 SEIS-qualifying companies – largely depending on the total raised in the tranche.
Across all its SEIS funds, Fuel Ventures has invested £10.7 million in 75 companies. Those investments are currently valued at £11.2 million (30 April 2023).
Below are portfolio company examples from the previous funds. They are outlined to give a flavour of the types of companies you might expect but will not form part of a new investor’s portfolio.
Supportwave (formerly NerdApp)
Many businesses find they need additional IT personnel for some tech projects, but hiring new people can add time and costs and can be challenging – recent data suggests 95% of employers are struggling to find IT talent. Supportwave's IT Support marketplace provides an alternative: it connects businesses with IT professionals on-demand, addressing the recruitment challenge and also offering significant savings.
The business was founded by IT professional and serial entrepreneur Kelvin Wetherill in 2019. Today the company has nearly 3,000 IT support staff, or “Nerds”, registered on its site, providing 24/7 support across 30 countries. Customers can either buy credit in advance or pay-as-you-go, expanding existing support resource when needed or entirely outsourcing the function.
The Fuel Ventures SEIS Fund backed the business in early 2022 as part of its £540,000 pre-seed round, supporting expansion in the company’s key target markets of the US and UK. That investment is now valued at 2.8x following a funding round in May 2023.
SparkLayer – recent investment
Founded in early 2021, SparkLayer is a business-to-business (B2B) ecommerce platform that aims to make it easy for retailers to enable wholesale functionality on their websites.
Founders Chris Mattingly and Rhys Laval had worked in the ecommerce software sector. They noticed B2B applications were more complex and involved more manual integrations than direct-to-consumer ones, to accommodate each client’s needs and often specially negotiated prices.
SparkLayer’s solution integrates B2B customer data, a Shopify store and website frontend, so its clients can provide their B2B customers with the kind of seamless self-service experience you’d find in a consumer-facing ecommerce site but with their own specific pricing. Today SparkLayer powers B2B sales for hundreds of brands.
The Fuel Ventures SEIS fund invested in the business in March 2023 to support the launch of new features and product enhancements.
Examples of previous exits and failures
The SEIS Fund is still comparatively young, having launched its first tranche in January 2021, so the track record remains limited and it has yet to experience any cash exits.
However, as is to be expected when investing in young businesses, failures often precede successes, and to date the funds has experienced one failure (detailed below). Please note, SEIS investments are very high risk, and you should expect some failures.
Hibana – example of previous failure
Hibana was founded during the COVID pandemic, by successful entrepreneur Peter Dakin and brand strategist Nick O’Quinn. They aimed to create a marketplace for independent brands, replicating the shop browsing that had disappeared during lockdown.
By May 2021, when Fuel Ventures invested £115,000 through its SEIS fund, the website already listed over 75 brands from across the UK.
While Fuel continues to believe both the technology and the founders were strong, the route to market proved more difficult than expected and cost of acquiring customers too high. As a result, Hibana became insolvent and dissolved in July 2022 having not been able to raise further investment.
Fuel has backed a total of 93 SEIS-qualifying companies: 18 through its EIS funds and 75 through the SEIS fund, which launched in January 2021.
Of these 93, 18 are valued above cost, at an average unrealised return of 6.9x, while 72 are held at cost, one is held below cost and two have failed. Past performance is not a guide to the future.
The chart below shows the performance of SEIS investments made through the EIS fund for tax years 2015/16 – 2020/21 and made through the SEIS fund thereafter. The chart is based on the latest valuations provided by the manager, expressed on a £100 invested basis. Please note, individual investor portfolios’ performance will deviate from the average.
Performance of SEIS-qualifying investments per £100 (18 companies)
Performance of Fuel SEIS Fund after launch per £100 invested (75 companies)
Source: Fuel Ventures, as at 30 April 2023. Past performance is not a guide to future performance. The chart shows realised returns (where share proceeds have been returned to investors as cash) and unrealised returns (where cash has not yet been returned and the value of the investments is based on the manager’s own valuation methodology). There is no ready market for unlisted shares. The figures shown are net of all fees and do not include any income tax relief or loss relief.
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 investments are high-risk and should only form part of a balanced portfolio. As must be expected with early-stage investments, some or even all of the companies in the portfolio could fail: the fewer the companies included in the portfolio, the higher the risk of loss if things don’t go to plan. You should not invest money you cannot afford to lose.
There is no ready market for unlisted SEIS shares: they are illiquid and hard to sell and value. There will need to be an exit for you to receive a realised return on your investment. Exits are likely to take considerably longer than the three-year minimum SEIS holding period; equally, an exit within three years could impact tax relief.
To claim tax relief, you will need SEIS3 certificates, normally issued once shares have been allotted. This can take several months: please check the deployment timescales carefully. Tax reliefs depend on the portfolio companies maintaining their SEIS-qualifying status. Remember, tax rules can change and benefits depend on circumstances.
Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks.
The fund relies heavily on the knowledge and experience of Mark Pearson. He is wholly committed to Fuel Ventures, but there is key-person risk. As the number of companies grows, he will not be able to provide the same level of coaching and support to all.
A summary of the main charges and savings is shown below. Some of these will be payable by the investor, whilst others by the investee companies. The investment may have additional charges and expenses: please see the provider documents, including the Key Information Document, for more details.
|Full initial charge||5%|
|Wealth Club initial saving||—|
|Net initial charge through Wealth Club||—||Annual management charge||—|
|Performance fee||30%||Investee company charges|
|Initial charge||—||Annual charge||1%|
More detail on the charges
In our view, the SEIS fund is a natural addition to Fuel Ventures’ existing offering.
Previous SEIS funds have now invested over £10 million and enabled Fuel Ventures to build a portfolio of 75 SEIS-qualifying companies. This has helped establish Fuel Ventures as a destination for entrepreneurs seeking SEIS funding.
Fuel Ventures’ investment strategy of focusing on marketplaces, platforms and SaaS companies, providing hands-on support, and potentially follow-on funding from Fuel’s EIS funds, could prove a compelling combination to attract high-calibre entrepreneurs.
The offer could appeal to experienced investors looking to complement a wider investment portfolio with exposure to a selection of early-stage digital businesses under SEIS.
You are now able to apply
Please read all the offer information first
Wealth Club aims to make it easier for experienced investors to find information on – and apply for – investments. You should base your investment decision on the offer documents and ensure you have read and fully understand them before investing. The information on this webpage is a marketing communication. It is not advice or a personal or research recommendation to buy any of the investments mentioned, nor does it include any opinion as to the present or future value or price of these investments. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.
- Target return
- Funds raised / sought
- Minimum investment
- 15 Dec 2023 for 2024/25 allotment