Do you need to raise some Seed Capital for your idea?
If you’re an entrepreneur or small company owner and you need to raise a relatively small amount of capital for your company or for a specific project, you could go to your bank, but in these economic times banks loans are hard to come by without personal guarantees. Unfortunately, traditional VC companies probably won’t even look at your project either unless you need more than £1M in funding, and we guess that your family and friends don’t have enough money lying around.
SEIS is one of the best opportunities available to you to raise that small amount of “Seed” capital you need to get your business off the ground and moving in the right direction. Investing in SEIS eligible companies can be appealing to many investors. If your company has been trading for less than two years, has less than 25 employees, is looking to raise up to £150,000 of seed capital and does not conduct one of a list of “prohibited trades”, your company may be eligible for advance assurance. For more information watch the short video below and if you want to know more click here.
Does my venture qualify?
For a company to qualify under the SEIS initiative it must meet a number of qualification tests. 4Oceans can help you to assess whether your business meets the criteria and even make an application to the HMRC on your behalf for what is known as Advance Assurance prior to accepting any investments.
Any funds raised by an SEIS share issue must be used by the company and spent within 3 years of the date of the share issue so we will also review your business plan to ensure that you will continue to qualify for SEIS for a minimum of 3 years from the investment is made.
Any of the following are qualifying business activities.
- carrying on a new qualifying trade which the issuing company or a qualifying 90% subsidiary is carrying on when the shares are issued
- preparing to carry out on a new qualifying trade which will be carried on by the issuing company or a qualifying 90% subsidiary
- carrying on research and development which is being carried on by the issuing company or a qualifying 90% subsidiary either at the time of issue of the shares or immediately after that issue, and which will lead to or benefit a new qualifying trade
Most trades qualify, but there are a number of “excluded activities” and if your trade consists substantially (generally interpreted as more than 20% of your activities) of excluded activities, then the whole trade will not qualify.
You can contact us here for further information.