Introduction
Welcome to this founder SEIS guide. If you’re an innovator looking to bootstrap or scale with early-stage investors, you’ve probably stumbled across the Seed Enterprise Investment Scheme (SEIS). In this founder SEIS guide, we’ll unpack:
- What SEIS is.
- Why it matters to founders.
- How it compares to similar schemes.
- How Oriel IPO can simplify your journey.
This founder SEIS guide is all about giving you clarity. No fluff. Just actionable steps.
What Is SEIS?
SEIS is a UK government scheme designed to help very early-stage businesses attract private investment by offering investors hefty tax breaks. It launched in 2012 and has since:
- Helped 15,000+ startups secure funding.
- Channeled over £1 billion into the UK ecosystem.
- Driven innovation in tech, sustainable ventures and beyond.
Think of SEIS as the safety net that makes angel investing a bit less scary.
Key SEIS Features
- Maximum fundraising: £250,000 per company (lifetime).
- Investor cap: £200,000 per tax year.
- Tax relief:
- 50% income tax relief.
- CGT exemption after three years.
- Loss relief and CGT reinvestment relief.
SEIS vs EIS: A Quick Comparison
Before diving deeper, let’s contrast SEIS with the Enterprise Investment Scheme (EIS):
| Feature | SEIS | EIS |
|---|---|---|
| Company age | < 3 years | < 7 years (from first commercial sale) |
| Fundraising limit | £250,000 (lifetime) | £5 million pa, £12 million lifetime |
| Income tax relief | 50% | 30% |
| CGT exemption | After 3 years | After 3 years |
| Ideal for | Very early-stage startups | Growth-stage companies |
If you’re a founder eyeing both, always start with SEIS. Then think about EIS when you grow beyond three years.
“Having SEIS and EIS in sequence can be a powerful way to keep investors engaged as you scale.”
SEIS Eligibility Criteria
Not every business can tap SEIS. Here’s what you must meet:
For companies:
- < 3 years old.
- < 25 full-time employees.
- Gross assets < £350,000.
- Permanent UK establishment.
- Not trading on a public exchange.
- No prior VCT/EIS funding.
Excluded trades (if >20% of turnover):
- Banking, insurance, debt or financing services.
- Property development.
- Legal or accounting services.
- Farming, coal/steel production, etc.
For investors:
- Must be a UK taxpayer.
- Cannot be employees; directors OK.
- No substantial shareholding (>30%) before investment.
- Close family (spouse, children, parents) excluded; cousins and friends OK.
Get this right and you avoid nasty surprises.
The Five Steps to SEIS Funding
In this founder SEIS guide, practical steps matter. Here’s your roadmap:
- Check eligibility
Nail the criteria. Use HMRC guidance. - Secure investor interest
Advance assurance hints that you’ve got a genuine pitch. - Prepare documentation
Business plan, financials, pitch deck. - Apply for advance assurance
A letter from HMRC saying “Yes, you look SEIS-worthy.” - Issue SEIS shares
Submit compliance statements once funds arrive.
What Is SEIS Advance Assurance?
Advance assurance is the formal nod from HMRC that your plan ticks the SEIS boxes. It’s not mandatory—but it:
- Speeds up investor decisions.
- Reduces due diligence friction.
- Signals you’ve done your homework.
Expect a few weeks for processing. Better to start early than scramble later.
Vestd vs Oriel IPO: A Comparison
While Vestd offers InVestd Raise—a nice fixed-fee workflow—some founders find its commission structure and regulatory scope limiting. Here’s how Oriel IPO stacks up:
Strengths of Vestd:
- Clear fixed-fee pricing.
- Templates for SEIS compliance.
- Integrated cap table management.
Limitations:
- Commission fees can add up for later rounds.
- Less focus on curated tax-efficient options.
- Limited community support beyond tools.
How Oriel IPO solves this:
- Commission-free funding: No surprises at exit.
- Curated SEIS/EIS opportunities: Quality over quantity.
- Educational hub: Webinars, guides, and peer forums.
- Subscription tiers to suit all budgets.
- Strong push for FCA regulation roadmap.
In a nutshell, while Vestd streamlines the paperwork, Oriel IPO empowers with cost efficiency and community learning.
How Investors Benefit from SEIS
Investors love SEIS because it cuts downside risk:
- 50% income tax relief on investments up to £200,000 pa.
- CGT exemption after a three-year hold.
- Loss relief if the company fails.
- CGT reinvestment relief on other gains.
Example:
You invest £10,000. Instantly you save £5,000 in income tax. If things go wrong, you offset 45% of the remaining £5,000 loss. Net loss? Just £2,750. Not too shabby.
How Founders Should Spend SEIS Funds
You’ve raised SEIS money. Now stay compliant:
Allowed:
- R&D.
- Product development.
- Sales & marketing.
- Hiring.
- Essential equipment.
Not allowed:
- Debt repayment.
- Acquiring other businesses.
- Shares buy-back.
Spend wisely. Keep evidence. HMRC audits do happen.
Preparing Your SEIS Round on Oriel IPO
On Oriel IPO, launching a SEIS round is straightforward:
- Create your company profile.
- Set funding target (up to £250k).
- Request advance assurance support.
- Publish your pitch to angel networks.
- Manage commitments via your dashboard.
Plus, you tap into:
- Real-time analytics.
- Mentorship sessions.
- Automated compliance reminders.
Everything in one place. No more email chains. No hidden fees.
Tips from This Founder SEIS Guide
- Start advance assurance early.
- Demo your product; investors hate dry slides.
- Show a clear growth plan (risk-to-capital test).
- Use a platform that supports tax-efficient rounds.
- Lean on community feedback.
A founder SEIS guide isn’t just theory. It’s about avoiding pitfalls. It’s about saving time and cash.
Final Thoughts
Navigating SEIS can feel like a maze. This founder SEIS guide gives you a clear path from eligibility to share issuance. Remember:
- SEIS precedes EIS.
- Advance assurance builds investor trust.
- Choosing the right platform matters.
With Oriel IPO, you get commission-free, community-driven support. And with our curated, tax-efficient focus, you raise smarter. Ready to fund your vision?
