Scottish Seed Fund
Small businesses and young companies may find it difficult to raise money from banks and investors. Scottish Enterprise introduced the Scottish Seed Fund (SSF) to improve the availability of finance for start-up and young growing companies in Scotland.
Funding of between £20,000 and £100,000 is available to companies. This can be:
- on an equity basis - making Scottish Enterprise an investor in the company by acquiring shares;
- as a loan - normally undertaken in exceptional circumstances. For example, when the external private equity investor decides to invest via a loan; or
- a combination of equity and loan funding.
Eligibility
The Scottish Seed Fund will invest in start-ups and early stage companies at the end phase of product development and/or commercialisation. When deciding whether to invest, we will consider:
- the nature, age and stage of the business;
- management skills;
- potential for innovation and growth;
- availability of other funding; and
- how the funding will be used.
Priority will be given to businesses demonstrating high-growth potential - in terms of launching new products, entering new markets and increasing employment. The Fund is also limited to supporting smaller businesses (up to 250 employees, with a turnover of less than £24 million or net balance sheet assets of less than £16 million).
Conditions
Conditions for securing investment include the ability to:
- demonstrate you have explored other funding sources;
- secure at least one external equity investor, for example, a business angel; and
- match at least 50 per cent of your company’s financing requirements via private sector sources. This could include:
- money from a bank, venture capital firm or business angel
- further investment by the existing owners of the company or new investors
The following would not be considered as matched funding:
- SMART/SPUR awards;
- Regional Selective Assistance grants; and
- capitalisation of existing stakeholder loans.
Find out more on the Scottish Seed Fund guidance notes (PDF, 103kb)
How to apply
To obtain an application form or discuss the Fund, contact your local Scottish Enterprise office.
Each application will be subject to appropriate due diligence by Scottish Enterprise advisers.
Find out more about our due diligence process
Investors
If you are an investor, contact the Local Investment Networking Company (LINC) Scotland to learn about opportunities for business angel investors wishing to syndicate, and discuss investment proposals.
Find out more on potential investment opportunities on the LINC Scotland website