EIP have been confirmed as a finalist for the Most Impactful Investment Award at this year’s Growth Investor Awards being held on 7 November.
EIP has beaten off stiff competition and made it onto the select list of three finalists for the Most Impactful Investment award at the Growth Investor Awards 2018. Sponsored by Bates Well Braithwaite Compliance.
The Most Impactful Investment award recognises the impact of the investment provider on investee businesses. The award category focuses on how funding has been deployed and how companies have grown or improved during the investment term.
Martin Sherwood, Partner at Enterprise Investment Partners said:
“It’s wonderful news to have made it onto the list of finalists for this award. The successful model which Imbiba and EIP have developed delivers profitable businesses, happy investors, satisfied customers, proud staff, and above all, beautiful premises, which all adds up to a powerful cocktail!”
EIP’s entry is based on their investments made via their Imbiba Leisure EIS fund, which invests in EIS opportunities within the bar, restaurant, event, catering and hospitality sectors in Central London.
EIP’s in strategic partnership with Leisure specialist Imbiba have to date raised approximately £40 million through a series of Funds over the last 6 years, equivalent to over £6m per year. Investment has been spread between 5 Central London bar/restaurant companies to date, with several more investments in the pipeline. Target return 2.5 x gross cash over a 5 year term. At EIP’s insistence, there is a high hurdle rate for management incentive purposes of £1.50 per £1 invested, believed to be the highest in the EIS industry.
The two most mature companies (Darwin & Wallace and Camm & Hooper) continue to trade well in challenging market conditions and targeting exits at a significant premium to original cost in Q4 2018 and Q1 2019 respectively.
If achieved, these returns will rank alongside previous returns from Imbiba Central London businesses: 2.2 x cash for Smith & Jones in 2000; 2.3 x cash for Thomas & Carter in 2002; 3.7 x cash for Lewis & Clark in 2006; and 5.7 x cash for Drake & Morgan in 2013. Imbiba’s average return from 10 EIS exits to date has been an IRR of 35%.
With EIP’s support, not only has Imbiba delivered growth through its various businesses, it has also contributed to the economy and fulfilled the Government’s requirement of proving the effectiveness of the EIS. EIP raised £7m of EIS funding (over two years) for an Imbiba company, which has turnover of £10m and pre-tax profits of £1.5m. So it pays corporation tax, it pays rates, stamp duty and VAT and finally, it employs close to 150 people, all of whom pay income tax. A quick back of the envelope calculation would suggest the business generates tax revenue of around £2.5m a year, for a one-time investment by the Government of just £2.1m (30% of £7m)!
Martin Sherwood, Partner
Martin Sherwood has many years’ experience of small company fundraising and in particular the tax-efficient investment market, specialising in the Hospitality & Leisure Sectors. Martin is currently chairman of the four British Country Inns companies and of Halcyon Hotels and Resorts plc, which was a major investor in Luxury Family Hotels, which he helped launch 20 years ago. He was founder and head of Tax Efficient Solutions, first at Teather & Greenwood (1997-2004) and subsequently at Smith & Williamson (2004-2010), which he left to found Enterprise.
Martin has been closely involved in both Venture Capital Trusts and Enterprise Investment Schemes since their inception, and is a founder director of the EIS Association, the official trade association of the EIS industry.
Martin works very closely with a wide range of Hospitality & Leisure entrepreneurs and has a significant network of investors and professional contacts as well as being a serial investor in his own right.
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