DFJ Esprit Launches New Fund Aimed At UK Start-Ups

Mark Shapland

2 April 2014

Venture capitalist has launched a new Enterprise Investment Scheme (EIS) fund for investors wanting a piece of the UK start-up scene.

EIS is the UK government’s flagship tax initiative aimed at boosting investment in start-up and SME businesses. It offers 30 per cent income tax relief on qualifying investments, with no capital gains tax to pay on the proceeds.

“EIS is a fantastic scheme and is a tax break that the government actively wants you to use. But to build large, successful businesses with global potential you need financial firepower and experience and we’re allowing private investors to access the kind of opportunities that wouldn’t normally cross their radar,” said Richard Marsh, partner at DFJ Esprit.

The latest fund is DFJ Esprit’s third EIS vehicle. The firm invested in eight companies through its first EIS fund, which is now fully invested. Half of DFJ Espirt’s second EIS fund has been invested across four companies, with further investments to come.

Previous DFJ Esprit investments that have been part of its EIS co-investment scheme include Horizon Discovery, a Cambridge-based life sciences company which is set to IPO and Lyst, the personalised fashion marketplace that recently raised $14 million of follow-on investment.

DFJ Esprit said its EIS Fund investments are realised within three to five years. In the past year, DFJ Esprit’s deal sizes have ranged from $415,000 to $25 million.

Statistics from HM Revenue & Customs show that £525 million was invested through EIS in 2010/11 - the latest year for which data has been released - and that could rise to an estimated £1 billion a year as a result of changes introduced by Chancellor George Osborne in 2012.