Edinburgh’s Equity Gap sees investments top £20m

Jock Millican (left) and Fraser Lusty of Equity Gap

Edinburgh investment syndicate Equity Gap said on Wednesday it has marked 10 years as one of Scotland’s most successful angel investment groups with record investment figures and a healthy pipeline of new deals.

The syndicate completed 22 investments in the first half of 2020, with total member funds invested since inception topping £20 million.

In June, it added Aberdeen-based green tech start-up Trojan Energy to its portfolio as the firm secured a £4.1 million round of seed funding to support the roll-out of its on-street flat and flush electric vehicle (EV) charging points.

Having grown from 15 to 150 members since inception, the Equity Gap’s portfolio of over 30 early stage start-ups has created over 400 jobs, primarily in Scotland, across a range of sectors including consumer product, food and drink, life science and SaaS.

But, as the UK officially moves into recession, Equity Gap’s directors believe entrepreneurs and new businesses “must play a significant part in rebooting the economy by creating employment opportunities, fuelling growth and driving future prosperity.”

Jock Millican, founder and director of Equity Gap and also chairman of the LINC Scotland angel capital association, said: “We have worked hard to ensure continuity of business and investment through an unsettling time and this is reflected in our half year figures.

“With a healthy pipeline of new investments, Equity Gap is well placed to continue to support young businesses through angel investment.

“It has never felt more important to support these fledgling organisations as we rebuild our economy.

“We are grateful to our syndicate members, who are now delivering more funding rounds to the emerging businesses within the portfolio than ever before.

“Equity Gap’s angels have stepped up and we have seen a significant investment uptake since March this year.

“An increase in scale up funding options for organisations with high growth potential is essential to help them realise their growth aspirations.

“Scotland’s angel investment community will continue to pull together to support our entrepreneurs.

“Overall figures from Q2 of 2020 show Scotland’s angel syndicates led 58 deals which totalled £40.87 million with approximately 20% of this investment going into new companies.”

Fraser Lusty, director, who joined Equity Gap shortly after it was established, said: “We have long been impressed by the quality and innovation delivered by our portfolio companies, but to see how many of these organisations have risen to the extraordinary challenges presented by the Covid-19 pandemic is nothing short of inspiring.

“Many of these firms have been able to pivot activity to focus on helping their own customers survive the breakneck shift online.

“For example, as the food and drink sector emerges from lockdown, QikServe’s touchless ordering and payment solution affords a simple answer for many bars and restaurants to manage these new processes.

“The future has many uncertainties, but we are confident that we will further develop our own digital technologies to support our membership and portfolio.

“We continue to educate and encourage active angel investment, and aim to support as many innovative new businesses as possible over the next decade.”

Equity Gap supports its portfolio with a broad base of knowledge and expertise, including support for pitching to its members.

Recent investments include Hydrosense, which has developed breakthrough technology for rapid testing for legionella, Boundary Technologies, the smart home security start-up, and MIME Technologies, specialists in medtech for in-flight emergencies.

Equity Gap expanded its operations earlier this year by hiring three more members of staff, taking the team to a total of nine, and moving to an Edinburgh city centre office.