What is an ESIC® – An Introduction
What is ESIC®? Am I an ESIC®? An Introduction to ESIC®
Welcome to the Spark Festival celebration of start-ups in Australia at Stone and Chalk’s facility in Sydney. We are all about empowering your early stage company to success. ESIC® Hub is Australia’s first and only online platform dedicated to serving the needs of the early-stage community. We have broken our early stage community up into three subsets of the population. We’ve got entrepreneurs, innovators, researchers and creators. We’ve then got investors and then advisers to each of those two sets of the population.
What is an ESIC®? ESIC® is a concept and an entity created under the Tax Act with effect from 1 July 2016. An ESIC® is defined in the tax legislation as an Early Stage Innovation Company. So the acronym is ESIC® and stands for Early Stage Innovation Company and that’s a concept that has its origins and its roots embedded within the Tax Act Australia which is the governing piece of legislation for all of this investment framework.
So what is all this ESIC® stuff about? Well ESIC® is a new investment framework. Why is it important to you? It’s important because this is a game changer, this is the platform on which the investment rules and a framework by which Early Stage communities are going to operate in Australia moving forward. The key concept here is if you’re a start-up and early-stage company are you an ESIC®? So what is an ESIC®? Am I An ESIC®? What do I need to do to become an ESIC®? All these considerations are relevant in this new investment framework that applies since 1 July 2016. ESIC® Hub came in, after having considered the legislation and has come up with three concepts to facilitate the raising of capital for early-stage companies. The reason we’ve done this is to inform and empower the early-stage companies to understand how this ESIC® investment framework actually affects them and the investors whom they are seeking to attract.
The three concepts that ESIC® Hub has created is the concept of a company being either ESIC® ready, ESIC® in progress or not ESIC®. Each of those three concepts means different things to an early-stage company seeking capital from third-party investors. ESIC® ready means you are an early-stage company that is ready to get on the ESIC® runway to raise capital. In other words, if you’re ESIC® ready you’re going to be enhancing your capital raising and connecting with ESIC® Hub will enable and empower you to do that. If you’re ESIC® in progress that means that you’re on the runway to becoming an ESIC®. You’re not quite there because a few individual circumstances affecting your company need consideration and a little bit of ironing out before you’re ready to jump on the runway and grab some capital on the ESIC® platform. The third one is not ESIC®. That’s a situation where you are an early-stage company that doesn’t meet the ESIC® guidelines as they currently exist.
The ESIC® guidelines, like every other concept of tax law, can change every day. Your circumstances may be such that the law changes and therefore you become ESIC® or your circumstances could be such that you require some surgery, this not ESIC® category isn’t there to prevent companies being involved in this program. It is simply a category or a label designed to give information to these companies around requiring additional work and considerations before you’re ready to get on this runway. Some Early-Stage companies that categorise as not ESIC® will never get on the ESIC® runway as they currently exist. However, some will actually get on the runway with some appropriate assistance and consultation with professional services such as those offered at ESIC® Hub.
If you’re an Early-Stage company wondering where you sit in the ESIC® environment, ESIC® Hub has assisted you by creating a framework and some Free Online Functionality where you can go and Self-Assess your ESIC® Status. You can do that by going to the ESIC® Predictor or you can search for ‘ESIC® Predictor’. This will drive you to some functionality that will take you 5 or Maybe 10 Minutes to complete. It’s a Free Functionality that we have contributed to the community, to assist in understanding the ESIC® framework.
In summary, we would encourage you to go and have a look at the ESIC® Predictor and ascertain whether you’re ESIC® Ready, ESIC® in Progress or Not ESIC®. Each of those things will mean different things and we can then connect with you if you would like and help you explore what that actually means for your circumstances.
You and Us working together
ESIC® Hub is Australia’s first and only online platform dedicated to serving the needs of the early-stage community. We offer you an effective pathway to efficiently allocate resources by utilising our deep technical knowledge and expertise to ensure client-centric outcomes are achieved.
We look forward to working with you.