Investment misallocation: Current SME trends

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With the heightened publicity enjoyed by companies in the Tech City cluster, you would be forgiven for thinking that only London-based, early-stage technology and digital businesses are securing angel investment, says Roxburgh Milkins’ Charles van der Lande.

Although this is a misconception, there does appear to be a notable early-stage, regional and sector bias in UK business angel investment. 

In fact, of the investments analysed in a recent report by Deloitte and the UK Business Angels Association, called ‘Taking the Pulse of the UK Investment Market,’

  • 80% were in early stage businesses
  • More than 50% were in digital and internet-based businesses
  • 54% were in businesses located in London and the South East

Even HMRC's own figures for companies claiming EIS relief show a strong bias towards...

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  • EIS and SEIS
  • Reasons for bias
  • The case for investing in later stage businesses

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