AIM Industry Report 2017/18

26 CURRENT RAISE The Current Raise chart shows the amount of money raised by each of the open offers at September 2017. An average open AIM offer has raised about £78 million, while a majority of the funds have a current raise of less than £50 million. This demonstrates that the market is fairly concentrated where a few big providers possess a large share of the market. For example, the largest offer has raised almost half a billion while the smallest offer has only raised £750,000. Having said that, the smaller funds are generally younger than the larger funds; for instance, the second and third largest funds recorded on our register were both launched in 2005 – 12 years in existence! TARGET NUMBER OF INVESTEE COMPANIES As always, we gauge the level of diversification by using the target number of investee companies. The average target number of investee companies is 29, which is significantly higher than the figure for services investing in unquoted businesses across all three types of tax wrapper. This is because the AIM market is more investable. In addition, compared to unquoted businesses, an AIM manager can invest in a greater number of companies with smaller amounts in each of the investees. The level of diversification varies significantly across the three tax wrappers with the target number of investee companies increasing in the order of EIS, BR and VCT. Although EIS is less diversified than both AIM BR and VCT products, investors can achieve a similar degree of diversification by investing in two or more different AIM EIS offers. Having said that, it is important to check the holding companies of potential investments to ensure that there isn’t too much overlap. CONSIDERATIONS FOR INVESTMENT “AIM is the most successful growth market in the world.” — ANDREW MARTIN SMITH, GUINNESS ASSET MANAGEMENT £550,000,000 £500,000,000 £450,000,000 £400,000,000 £350,000,000 £300,000,000 £250,000,000 £200,000,000 £150,000,000 £100,000,000 0 29 27 25 23 21 19 17 15 13 11 9 7 5 3 1 31 30 29 28 27 26 25 24 23 2221 20 19 17 16 15 14 13 12 11 10987654321 18 31 20 10 0 30 40 50 60 70 80 CURRENT RAISE TARGET NUMBER OF INVESTEE COMPANIES 2017 has seen the AIM market stabilise in terms of cancellations and accelerate in terms of new IPOs. While political uncertainty is high, the volatility for which AIM is renowned has largely failed to materialise in the last year. In fact, the tumultuous political situation has actually been one of the drivers for IPOs in some sectors, as has the clock ticking down towards the complete unknown of life outside the EU. CONCLUSIONS