Although its Patient Capital Review and subsequent planned legislative changes caused consternation among industry and investors, following the announcements what has shone through is the government's commitment to the scheme.
Through its research and updates, the government has made sure that EIS continues to do what it is meant to – fund the companies that will shape the UK's economic future.
That has meant directing investment – both initial and follow-on – towards 'knowledge intensive' companies with high levels of research, innovation and intellectual capital.
While the government’s stance on asset-backed investing has been clear, so has its overall position on EIS, ensuring it continues to cater to investors and companies. All the tax benefits remain, while the amount that can be invested has doubled from £1m to £2m.
Most recently, the government announced additional rigour for EIS through a refined structure to be implemented from 2020. This includes the requirement that at least 80 per cent of funds raised must be invested in knowledge-intensive companies.
With continued government support, funding requirements from firms, and the tax mitigation needs of investors, it is highly likely we will see more firms offering EIS.
Richard Cook is chief executive of Blackfinch Investments