What are the common misconceptions about an ESIC?
ESIC Hub’s list of common misconceptions about being an ESIC.
Misconception No 1. In order for a company to qualify as an ESIC it must have high growth potential.
No. Once a company meets the early stage test it can qualify as an ESIC if it meets the 100-point innovation test, which is unrelated to its growth potential. To qualify as an ESIC it is NOT necessary for a company to have high growth potential.
Misconception No 2. You need to be a start-up company to qualify as an ESIC.
No. An existing company that has been operating for years can be an ESIC. It is okay for the company to have ceased or interrupted its trading in those years too.
Misconception No 3. A company already requires the backing of a private equity or venture capital firm to qualify as an ESIC.
No. Investors who are family and friends, as well as the big end of town, can be considered when assessing a company’s ESIC status and benefits.
Misconception No 4. A company founder cannot receive the ESIC tax benefits on their shareholding.
No. If the founder pays for new equity and owns no more than 30% of the company (inclusive of associates), he/she can qualify as an early stage investor and receive the ESIC tax incentives.
Misconception No 5. If I go online and complete the ESIC Predictor my company will be advertised on a public list and available to everyone to see.
No. Any information provided to ESIC Hub is kept confidential, treated securely and managed in a respectful environment governed by professional and ethical rules and obligations of independent professional associations, and the Privacy Act. We are like doctors and lawyers.
When you are ready to dance on the capital raising stage, we know the routine. In the meantime, our focus is on getting you ESIC Ready and the ESIC Predictor is the shoe that fits.