The £50m investment fund that could help you to start and grow your business
05 June 2017
It’s great to see that several agreements have now been reached under the Department of Economic Development’s Enterprise Development Scheme (EDS), with funding of more than £1.2 million so far committed to helping new businesses to the Island and expand existing on-Island firms.
There is recognition from the Government that encouraging the development of businesses through all phases of the business growth cycle is essential to the creation and maintenance of a diverse and successful economy. It’s our belief that the EDS has the potential to accelerate our economy towards the Government’s key strategic objectives of creating an economy where local entrepreneurship is supported and thriving and more new businesses are choosing to call the Isle of Man home. The EDS offers support to small and medium sized businesses and is designed to help in the expansion of established and new businesses to the Island, particularly those providing their goods and services to an international customer base.
Two of the strands of support available are managed by fund managers SPARK Impact: the Accelerator Scheme provides loan and equity support for on-Island businesses entering their next growth phase; the Relocator Scheme offers equity, or other funding, investment to encourage new businesses to locate and existing businesses to relocate here. The EDS works in parallel with grant and business schemes offered by the Department, including:
The Micro Business grant scheme;
Small Business grant scheme;
Finanical Assistance Scheme;
Business Support Scheme;
and Vocational Training Financial Scheme.
It is pleasing to see the agreements have been made across a number of sectors, ranging from healthcare to eCommerce and technology. Among those to have received support so far is Nimbus Medical Holdings Limited, a technology firm founded in Merseyside in 2014. It has received equity investment under the EDS to allow it to expand, resulting in Nimbus relocating to the Island late last year with the creation of three jobs. The company has developed an integrated technology platform, InterCare, to help the elderly and chronically ill to live at home safely. It’s being used by NHS trusts in the north of England with the company now ready to roll out the system to more users.
Meanwhile, new start-up Scout4 has described the equity investment it has received as providing a ‘firm foundation’ for the company to expand and grow in the Isle of Man. It launched Jobhawk, an app-based marketplace for the UK construction industry that matches construction workers with major subcontractors. It’s a new concept for the industry which has already been embraced by several major UK industry names.
Overall, the EDS is a very interesting and welcome economic initiative from the Isle of Man at a very interesting time in international investment. The Island has enjoyed unbroken economic growth for the last 30 years and holds significant capital reserves. In recent years the Island’s success has been in the digital e-Business sector which now accounts for 25% of GDP. This can be largely attributed to the Island’s superior technology offering (global telecoms interconnectivity, massive broadband capacity and independent power generation from natural gas) combined with a neutral tax regime for corporate and capital gains categories.
The current global environment for technology investment is challenging simply because the traditional heavy investment flows from the US to Europe have slowed due to fears over the fallout of the recent British vote to leave the EU. As a consequence there are now legitimate concerns US venture capitalists may hold fire as perceived EU economic and political risks take hold. According to the Dow Jones, European start-ups suffered a sharp decline in funding, raising 2.1bn Euro from venture capital funds with 464 deals, a drop of a third from the previous quarter and 39% lower compared with the same period last year. Similarly research group Pitchbook recorded a 37% year on year decline in venture capital investment in European start-ups, and a 31% drop in deals completed, in the third quarter of 2016. It was against this backdrop that the Isle of Man launched an investment vehicle that is both compelling and competitive.
We hope you agree, the EDS is a dynamic offering that is already creating momentum in our economy. If you would like to know more email me at email@example.com
Download the EDS guidance document for information about eligibility criteria.