In September 2005 Summit participated in a bid on behalf of a group of nine
Corporate Venturers and Business Angel Groups from across the UK and also the
east coast of the USA to manage one of the new Enterprise Capital Funds (ECFs).
ECFs were announced in the 2005 Budget as a structure to make it more
attractive for investors to provide venture capital to UK businesses which are
seeking less than £2 million.
The main attraction of an ECF to investors is that their potential returns are
strongly enhanced by leverage provided by the Government which co invests up to
twice the amount of the private investors' commitment in an Enterprise Capital
Fund but at a 4.5% rate of return (plus a small profit share) so that, if
successful, the bulk of the profits accrue to the investors.
The Seraphim Capital consortium was successful in its bid to manage a £30
million fund and was one of the six winners announced in May 2006. It was the
first to complete the Enterprise Capital Fund documentation and formally
launched in early September 2006 with all its funds in place.
Summit is one of the four managing partners of Seraphim, who assess, implement
and oversee its new investments, and Summit's managing director, Kit Hunter
Gordon, chairs Seraphim's Managing Partner board.
Summit has undertaken to offer Seraphim all investment opportunities falling
between £0.5 million and £2 million and qualifying investments in this range
will be undertaken through Seraphim.