Investment Strategy
What do we invest in?
The Haatch EIS Fund invests in Seed-stage B2B businesses that have proven their product solves a deep pain by securing contracts with a consistent customer profile and showing early signs that customers will renew or expand those contracts. We target a minimum of £10,000 of monthly recurring revenue; however, in most instances, companies have more.
Companies will have built an efficient go-to-market strategy to source these customers and close new business with a conservative scope to reach £100,000 monthly recurring revenue within 12-18 months, which is the current Series A benchmark.
Our Differentiated Source of Deals
The Haatch EIS Fund leverages the information rights from previous Haatch SEIS investments, to observe the fastest-growing companies that can efficiently reach and acquire customers with the scope to be incredibly successful companies, and we re-invest through the Haatch EIS Fund. The Haatch SEIS Fund makes 15-30 new investments per financial year, providing an abundance of quality deal flow for The Haatch EIS Fund. These investment rounds are typically highly competitive and oversubscribed; however, our relationship and demonstrable go-to-market support win us allocation.
Tier 1 Funds Seek Us Out
In addition to investing in the top-performing Haatch SEIS companies, The Haatch EIS Fund also invests alongside Tier 1 investment funds we have relationships with as part of a larger investment round. Such funds share companies they’re investing in with Haatch as we’re considered strategic value-add given our go-to-market focus differentiates our money from other sources of funds.
As seasoned entrepreneurs and operators with over £100m of personal exits, we focus on revenue, the quality of it and business profitability. We spend less time hypothesising and more of it on the practicality of backing great entrepreneurs who can build quality businesses.
Why should EIS form part of a portfolio?
Brian Moretta, Head of Tax Enhanced Research at Hardman & Co recently wrote on ‘Does Consumer Duty oblige you to add venture capital to client portfolios?” which sparks an interesting debate. With the introduction of Consumer Duty this year, portfolio diversification is now more important than ever.
He says, “it is true that individual venture capital investments are riskier than the usual quoted equities or bonds, even after the excellent tax reliefs that SEIS, EIS and VCTs bring. But as a whole, they are also a diversifying asset class, and this is the key to making them essential investments.”
He also adds, “If past performance is replicated, you can improve expected returns without increasing portfolio risk. A sprinkling of venture capital should be a normal part of most investors’ portfolios.”
Brian has written a summary of his original white paper, which is highly relevant and a quick read. You can read Brian’s latest summary of his original white paper here.
“Haatch has progressed significantly in the past year and is now the best-established EIS manager of its age. Although the funds are five years old, the team has been investing for more than twice that, and brings a broad range of relevant knowledge. The early commitment from British Business Investments through the Regional Angels Programme is a notable endorsement for a newer manager.”
– Hardman & Co, January 2025
“Haatch has some experienced entrepreneurs as its investment partners who have successfully built and sold companies, including Scott Weavers-Wright OBE who sold Kiddicare.com to Morrisons for £70 million cash along with Elevaate for $25.7 million (the latter in conjunction with Fred Soneya), and Simon Penson who sold Zazzle Media to the world’s fourth largest advertising and marketing network after a successful merger”
-MICAP, January 2024
The Haatch SEIS Fund invests in pre-seed companies that typically have less than £100,000 of revenue or a proof of concept live with a lead, used as evidence they’re solving a deep pain. A Haatch SEIS fund comprises 10-15 such businesses.
Haatch EIS and SEIS Funds both target 5x blended returns to investors (not guaranteed) and offer a diversified portfolio of investments.
Comparatively, The Haatch EIS Fund has a more concentrated portfolio than The Haatch SEIS Fund as it invests at a later stage where companies have more information to diligence and, therefore, higher confidence levels for success.
The tax treatment of each Fund depends on the individual circumstances of each client and may be subject to change in future.
Haatch Direct is our new EIS Syndicate, which will be launching in Q1 2025.
Haatch Direct enables investors to participate in select Haatch deals by investing alongside us on a discretionary basis outside of our Pre-Seed & Seed SEIS & EIS Funds.
Each company is hand selected by our investment team and is a business that one of our core funds has invested in but we’ve created additional exclusive allocation for our Haatch Direct members, ensuring each syndicate company receives the exact same level of award winning support from our experienced team of entrepreneurs & operators.
Whilst Haatch Direct launches soon, join the waitlist now to find out more!
The tax treatment of each Fund depends on the individual circumstances of each client and may be subject to change in future.