The Scottish Investment Bank (SIB) operates across Scotland to support the development of private sector SMEs through various financial interventions. It provides (1) financial readiness advice to over 400 companies annually, (2) co-investment with private partners in equity funds totaling around £30 million annually, (3) mezzanine loans between £250,000-£5 million through the Scottish Loan Fund, and (4) loans through specialized funds focused on recycling, renewable energy, and life sciences startups. The SIB works closely with portfolio companies to support their growth and commercial success.

1. Scottish
Investment Bank -
Overview
February 2015

2. Background to SIB
• 2009 First Minister announced establishment of a
Scottish Investment Bank
• 2010 SIB launched from SE’s Equity Fund operations
division
• Operates on a Scotland-wide basis
• Partnership with wider SE & HIE business development
activity

3. Operating Plan 2012-15
Remit
• Support the development of Scotland’s private sector SME
funding market to ensure that both early stage and
established SMEs with growth and export potential have
adequate access to growth capital
Rationale
• To address specific market failures/gaps in the growth
capital market for this cohort of companies where
intervention will have a demonstrable positive impact

4. Growing the Investor Base
• Bringing in new private investors, both local and
international
• Angels, VCs, Corporates
• examples include recent work with SR One
(corporate venture arm of GlaxoSmithKline) & Dow
Venture Capital
• Develop, grow and professionalise angel syndicates
alongside LINC Scotland
• Pilot Initiatives
• Gabriel Investment Syndicate project

5. SIB’s Current Interventions
• Financial Readiness Advice
• Growing the Investor Base
• Suite of Equity Investment Funds
• Scottish Loan Fund
• Delivery of the Scottish Plastics Loan Fund
• Delivery of the Renewable Energy Investment Fund
• Investment into a Scottish Life Sciences Venture Fund
• Portfolio Management

6. Financial Readiness Advice
• Recognised source of independent business advice for
growth companies
• Team of specialist advisors work with companies to
• guide through complexities of various finance options
• identify appropriate finance
• support on securing finance
• provide access to relevant public sector support
• C.400 companies assisted pa

7. SIB’s Equity Investment Funds
Partners introduce deals to SE to be
matched subject to diligence and
negotiation.
£500k - £2m£2m - £10mScottish
Venture
Fund
Partners are vetted, the SCF will match
all qualifying investments from
registered partners subject to
eligibility.
£100 - £1m£500k - £2mScottish
Co-investment
Fund
Targeted at early stage deals, external
investors usually required, debt and
equity options.
Up to £250kUp to
£500k+
Scottish
Seed Fund
Key FeaturesSIB
Participation
Transaction
Size
Maximum transaction size £500k £2m £10m
SCF
Up to £1m
SVF
Up to £2m
SSF
Up to £250k

8. SIB’s Equity Investment Funds
• Co-investment with private sector partners
• Gap investors – no displacement or crowding-out
• Fully Commercial – equal rights
• Commensurate economic benefit
• Restricted activities
• Public sector contribution ≤50%
• Voting shareholding <30%
• Annual investment c. £30m

9. Scottish Loan Fund (SLF)
• Established March 2011
• Current fund capital value - £113m
• Public sector capital (includes ERDF & HIE) - £55m
• Investors – Lloyds, RBS, Santander, Clydesdale, Strathclyde
Pension Fund, Aberdeen City Council Pension Fund
• Independent fund managers – Maven Capital Partners
• niche product
• targeted at growth and export companies
• mezzanine loans £250k - £5m
• SMEs annual turnover of £1m+
• investment to date c.£32m (c£41m committed)
• 17 companies

10. Scottish Recycling Fund
• Launched September 2012
• In conjunction with Zero Waste Scotland
• Response to address the current shortage of plastics
sorting and recycling capacity in Scotland
• Current fund capital value - £3.8m
• Loans for capital investment £50k to £1.25m

11. Renewable Energy Investment Fund (REIF)
• Launched October 2012
• ‘Team Scotland’ approach across public sector
• Promote energy from renewable sources and drive further
investment into renewables
• Priority sectors – marine, community owned renewables,
district heating
• Fund capital value - £103m to be invested by March 2016
• REIF products include – loans, equity, guarantees

12. Scottish Life Sciences Fund
• Launched January 2013
• New Scottish based Venture Capital Fund
• Managed by Rock Spring Ventures, life science sector
investors
• Focus on early stage life science and health technology
companies
• Target Fund size - £50m, first closing of £26m
• SE investment of £5m alongside EIF as lead investor and
Glasgow, Edinburgh and Aberdeen Universities and
Strathclyde Pension Fund

13. Portfolio Management
• Work closely with management teams, co-investors and SE &
HIE colleagues
• Support development of growth companies
• agree and deliver strategy
• shape and enhance management and board composition
• appoint Non Executive Directors
• access to networks and contacts
• Integral part of Account Teams – joined up/value add/team
Scotland
• Seeks to optimise economic and commercial returns

14. SIB Private Sector Investment
Partner Examples

15. SIB Portfolio Companies

16. For all general
enquiries
telephone Scottish
Enterprise on
0845 687 8787
Contact Email -
SIBAdmin@scotent.co.uk
For more
information about
The Scottish
Investment Bank
visit
www.scottish-
enterprise.com/sib
Scottish Enterprise can also be
followed on Twitter at
twitter.com/Scottish Enterprise
Gary Torbett
Financial Readiness Specialist
Scottish Investment Bank
gary.torbett@scotent.co.uk
0141 242 8400
Scottish Enterprise
Atrium Court
50 Waterloo Street
Glasgow
G2 6HQ