AIM Industry Report 2017/18

85 84 THE FUTURE FOR AIM WHAT NEXT? There may be no merger with Deutsche Börse, but this may not be a bad thing at a time when advisers are positively swimming in change and potential change. In fact, many of those we have spoken to about AIM see it as a market worthy of the old adage – “if it ain’t broke, don’t fix it”. And, it seems that the London Stock Exchange would do well to tread carefully with any rules changes that result from its discussion papers about tightening up regulation of entrants to the market: It appears that those with the most experience of AIM investment favour improving awareness of potential investors over possible unintended consequences of raising the bar for firms wishing to join. The potential for a continuing drop in the number of Nomads, and their waning willingness to take the responsibility the LSE requires, could threaten firms in the riskier parts of the junior market – particularly the smaller or more complex AIM-quoted businesses 73 . This would certainly be contrary to the current political will to drive the opportunities for risk capital. Nevertheless, our economy requires SMEs to keep expanding, so Brexit must not be seen as the be all and end all. The government’s agenda to support SMEs and scale ups is clear as well as the requirement to protect British business. For those reasons, we think that the most widely used tax-efficient AIM-focused investment services – those which look to achieve Business Relief – will continue to proliferate. There is currently real positivity around the role that AIM plays in bringing great growth opportunities to the attention of well-informed investors, whether they are looking for tax efficiency or not and that makes AIM a market of continuing interest for advisers. “The availability of innovative and tech companies at the lower end of market cap scale, for which some due diligence and corporate governance has already been undertaken as part of the AIM listing process, could make AIM a more interesting hunting ground for those seeking to take advantage of the higher levels of VCT and EIS funding now allowed in the knowledge-intensive sector.” “Many of those we have spoken to about AIM see it as a market worthy of the old adage – “if it ain’t broke, don’t fix it”. 1 Aim IPOs bounce back as Brexit jitters ease, Financial Times, 15 October 2017 2 London Stock Exchange Discussion Paper (July 2017) AIM Rules Review Law Society and City of London Law Society joint response, 8 September 2017 3 ICAEW Representation 96/17 AIM Rules Review, ICAEW 4 AIM rules review, Blick Rothenberg, 2 August 2017 5 Long Term Reporting Guidance, The Investment Association, May 2017 6 Long Term Reporting Guidance, The Investment Association, May 2017 7 Long Term Reporting Guidance, The Investment Association, May 2017 8 Financial watchdog to probe reports of 40 small firms, FT Adviser, 17 November 2017 9 MiFID II: what regulation means for you and your investments, Love Money, 2 August 2017 10 Annual Review of Corporate Reporting 2016/17, Financial Reporting Council, October 2017 11 Aim bounces back despite Brexit fears with number of companies joining rising, City AM, 18 April 2017 12 Investors retreat into cash as political uncertainty weighs, Investment Week, 16 October 2017 13 Growth Report 2017, Albion Capital, October 2017 14 UK SME Brexit Statistics: Survey Unearths Business Owner Opinions, Russell Smith Chartered Accountants, 26 September 2017 15 Growth Report 2017, Albion Capital, October 2017 16 Market Spotlight, BDO AIM Sectorwatch, DirectAIM, July 2017 17 Markets Update, British Business Bank, September 2017 18 FSB Voice of Small Business Index, Federation of Small Business, Q3 2017 19 FSB Voice of Small Business Index, Federation of Small Business, Q3 2017 20 Agents’ summary of business conditions and results from the Decision Maker Panel, Bank of England, Q3 2017 21 IPO Watch Europe Q3 2017, PWC 22 Equity Capital Markets Q2 2017, Smith and Williamson 23 How bullish Nex Exchange boss Patrick Birley is taking aim at the London Stock Exchange's junior market, City A.M., 27 March 2017 24 Margrethe Vestager, EU competition regulator, March 2017 25 Laurence Sacker, UHY Hacker Young, Managing partner, April 2017 26 Eight AIM stocks now worth more than £1 billion, Chares magazine, 10 March 2017 27 Laurence Sacker, UHY Hacker Young, Managing partner, April 2017 28 Magnificent #7: These AIM oil stocks have at least doubled in 2017 so far, Proactive Investors, 16 April 2017 29 AIM INSIGHTS REVIEW OF AIM FOR THE SIX MONTHS TO JUNE 2017, BDO, June 2017 30 AIM INSIGHTS REVIEW OF AIM FOR THE SIX MONTHS TO JUNE 2017, BDO, June 2017 31 AIM market breaks 1000 level for first time in nine years, Money Marketing in Focus, 6 September 2017 32 Brexit Fallout Is Driving U.K. Firms to Nasdaq’s Nordic Market, Bloomberg, 11 September 2017 33 London dominates IPO activity in Q3 with financial services taking centre stage, EY, 2 October 2017 34 Is a bubble starting to form in parts of the Aim market? Money Observer, 8 May 2017 35 Is a bubble starting to form in parts of the Aim market? Money Observer, 8 May 2017 36 AIM is a Voyage of Discovery for Discerning Investor, Portfolio Adviser, November 2017 37 Eddie Stobart trucks back to the stock market with £550m AIM float, The Telegraph, 23 March 2017 38 City consultant latest to bat off Brexit jitters with IPO move, The Telegraph, 25 September 2017 39 How to play the Alternative Investment Market, Interactive Investor, 8 April 2016 40 The Aim 100: 2017, Investors Chronicle, 21 April 2017 41 KEYWORDS STUDIOS WINS PRESTIGIOUS AIM GROWTH BUSINESS OF THE YEAR AWARD, AIM Awards, 13 October 2017 42 KWS Keywords Studios PLC ORD 1P, LSE, 25 October 2017 43 Gear4music in line to meet expectations, Interactive Investors, 23 October 2017 44 ADVANCED MEDICAL SOLUTIONS TO MEET EXPECTATIONS AS INTERIM PROFIT UP, Alliance News Detail, LSE, 13 September 2017 45 LSE 46 UK Small Business Statistics, Business Population Estimates for the UK and Regions in 2016, FSB 47 Boosting UK productivity with SME growth, Economic and Social Research Council, May 2016 48 Financing Growth in Innovative Companies – EISA response to the consultation paper, EISA, 22 September 2017 49 Financing Growth in Innovative Companies – EISA response to the consultation paper, EISA, 22 September 2017 50 MICAP 51 Inheritance tax: exemptions and reliefs, HMRC, 28 July 2017 52 Enterprise Investment Scheme Seed Enterprise Investment Scheme and Social Investment Tax Relief, HMRC, October 2017 53 Venture Capital Trusts Statistics, HMRC, October 2017 54 Financing Growth in Innovative Companies – EISA response to the consultation paper, EISA, 22 September 2017 55 BVCA report underlines contribution of EIS & SEIS to UK GDP, EISA, 2017 56 BVCA report underlines contribution of EIS & SEIS to UK GDP, EISA, 2017 57 Transforming Small Business, AIC, August 2017 58 Transforming Small Business, AIC, August 2017 59 ECSC SINKS TO INTERIM LOSS AS SALES CONVERSION DISAPPOINTS, Alliance News Detail, 27 September 2017 60 Transforming Small Business, AIC, August 2017 61 FREEAGENT STAYS LOSS-MAKING AS MARGIN TIGHTENS, BUT REVENUE SURGES UP, Alliance News Detail, 10 October 2017 62 HORIZON DISCOVERY EXPECTS REVENUE OF UP TO GBP41 MILLION IN 2017, Alliance News Detail, 26 September 2017 63 Rise of the Growth Hunters, UK INVESTORS AND EARLY-STAGE EQUITIES, Syndicate Room, November 2016 64 AIM’s best dividend stocks, Interactive Investor, 28 October 2016 65 10 best quality dividend yields on AIM, Interactive Investor, 14 September 2016 66 AIM’s best dividend stock, Interactive Investor, 28 October 2016 67 LOK'NSTORE SEES FULL YEAR REVENUE AND OCCUPANCY GROWTH, Alliance News Detail, 9 August 2017 68 Hargreaves Lansdown, 27 October 2017 69 TRISTEL HIKES DIVIDEND PAYMENT ON STRONG ANNUAL PERFORMANCE, Alliance News Detail, 19 October 2017 70 AIM Statistics June 2016 – October 2017, London Stock Exchange 71 Rame Energy appoints administrators and blames Brexit, Proactive Investors, 6 August 2016 72 Why is market volatility so low when uncertainty is so high?, Marketwatch, March 7 2017 73 Record number of advisers quit London’s AIM market, study finds, Reuters, 24 July 2017 APPENDIX REFERENCES