Linc Scotland determined to blood more angels

Figures from angel trade body Linc Scotland yesterday showed that 36 early-stage Scottish firms received a total of £15.5 million in the first six months to 30 June, a jump from £10.3m in the same period last year.

About one-third of those investments were first-round fundings.

David Grahame, chief executive of Linc, said the fresh investment came from syndicates such as Equity Gap and Alida Capital, Kelvin Capital and Bradenham Partners.

The economic downturn has limited the number of corporate buyers for maturing companies, significantly cutting down on the exit options for established investors. Some private equity backers have been holding investments for six to seven years, versus a “normal” cycle of four to five years.

With less money to plough into new investments, it has fallen on fresh entrants to support first-round funding.

“It is essential that we bring new players in to keep the momentum going,” Grahame said.

The £15.5m raised through Linc included four larger deals of more than £1m. Among these was the £1.6m investment in MiiCard led by Par Equity and the £1.1m raised in part from Kelvin Capital for medical start-up Mode Diagnostics.

“If you purely look at the investment amount, it looks like a big jump, but a few of those were quite chunky deals,” Grahame said. “I read it as encouragingly steady in what are really very challenging times.”