Through patient capital that relied heavily on the EIS, the business was able to scale, growing from a team of 12 in 2012 to 200 by 2019, with its motors in production vehicles for the likes of Ferrari and McLaren.
The continuing impact of the technology goes beyond automotive, with YASA’s aerospace spin-out Evolito developing a prototype with Rolls Royce, which has broken both altitude and speed records for electric aircraft.
YASA was acquired by Mercedes-Benz in July 2021, but is maintaining its R&D headquarters in the UK. Evolito is just one example of a potential future beneficiary of EIS funding.
The success of a UK startup such as YASA is fantastic to see, but it must be recognised that the journey from being spun out of Oxford University to exit was more than 10 years. There were many investors who supported the business throughout this journey, but the EIS was instrumental throughout.
The businesses that could IPO or exit in the next 10 years are currently receiving the funding through such schemes. This is yet another reason why investors need reassurance that their EIS and VCT investments will continue beyond 2025, so they can continue funding the YASAs of the future.
The venture capital industry in the UK is now, in many respects, a well-established ecosystem with many investment companies who focus on a wide variety of investment sectors and several stages of funding.
We should not let something as easy to resolve as a sunset clause deter the investors of today from securing the success of the UK’s innovation pipeline tomorrow.
Moray Wight is chief executive of Parkwalk Advisors
