Braveheart plans to nurture more talent with float

Published on Wednesday 28 March 2007 00:15

BRAVEHEART Investment, the Perth-based business angel investment group, is to float on AIM, raising £6.64 million which it plans to use to continue its work of investing in young emerging companies.

The firm, which is just over a decade old, has placed some 3.9 million new shares on the market, and sold 160,725 existing shares, both at 160p, giving it expected market capitalisation of 21.45 million. Dealing will start on Friday. It is Scotland's first float this year.

Braveheart claims it will be the UK's only listed firm of its type, and the float comes nine months after initial plans were shelved because of market jitters.

Chief executive Geoffrey Thomson is one of the original group of four investors who each threw a mere 100 each into a pot to invest in fledging start-ups. It now has 110 business angel investors, of whom half were shareholders.

Braveheart's investment model involves members advising, and in some cases taking directorships, at the companies in which they invest. The highlights have included Optos, the Scottish optical technology firm, and Edinburgh's highly successful Wolfson Microelectronics.

With strong links to Scottish universities including St Andrews, Strathclyde and Glasgow, along with Hillington Innovation Centre, Thomson said yesterday the flotation provided a great opportunity for the public to now invest in some of those future successes.

"The capital raised will ensure the company is adequately capitalised to implement its near-term objectives and we are delighted the public will now be able to participate in what we are doing by holding shares."

Braveheart gains revenue from regular investment management fees and through the realisation of investments upon exit. Thomson added that an equal investment made in every portfolio company since the group's formation would have generated an average compound return of 37 per cent per annum on realised investments.

Of the 16 portfolio investments realised so far, five have been by way of IPO, and three have been by way of trade sale or secondary purchase. Eight have been written off.

Braveheart has been profitable for its last three financial years. Last time profits were 151,657 on a turnover of 528,474. Since 1997, the group and its clients have invested 61 rounds of funding into 38 companies, of which 19 were spin-outs from universities.

Thomson added that he and his fellow directors, including chairman and co-founder Garry Watson remained "firmly wedded to the business", as he aimed to hit a market cap of 100m within three years.

Its board of directors include Donald Turner, a former Scottish managing partner at Ernst & Young and past chairman of the SDCI, and Shonaig Macpherson, the former senior partner of McGrigors and current chair of the SCDI and National Trust for Scotland.