Octopus Investments has opened a new £15m fundraise for Octopus Future Generations VCT.
Octopus says the Future Generations VCT is part of its ambitions to back businesses that have the power to transform the world for the better, and part of its belief that some of the best investment returns will come from companies trying to solve society’s biggest problems.
The VCT was launched in 2022 and is managed by Simon King, a Partner in Octopus Ventures. It offers investors the opportunity to access a portfolio of early-stage companies which are aligned with three core investment themes:
- Building a sustainable planet: By reducing carbon emissions, protecting ecosystems, or creating circular economy.
- Empowering people: To create a fairer and more equitable society, by making the world a better and safer place.
- Revitalising healthcare: By backing businesses that are moving health and wellbeing forwards, such as by investing in entrepreneurs that are improving lives through digital health solutions.
In keeping with its Future Generations ethos, Octopus donates 10% of its annual management charge to Octopus Giving, its charitable foundation dedicated to supporting charities that drive positive and social change.
The team employs a rigorous investment process, engaging with thousands of businesses, but only selectively investing in the top 10-15 each year for the Future Generations VCT, which have the potential to transform outdated industries for the better. Prospective investments tend to be companies with innovative technology, with the potential for rapid growth, have talented and ambitious management teams and are aligned with one of the three sustainability investment themes.
Simon King said: “We live in a changing world. But we believe that a new world is possible – one where the most successful companies are a force for good. The entrepreneurs we back are reimagining how whole industries behave.
“We’re backing teams who are eliminating carbon footprints, creating cancer vaccines, building the next phase of the internet and charting a greener approach to space travel, to name just a few. By 2030 it is the aim of Octopus to have invested £10 billion into the industries that are bringing about a positive change in the world and we firmly believe that the Future Generations VCT will be at the forefront of this mission”.
Talking to the advantages of VCTs, Jess Franks, head of Investment Products at Octopus Investments, added: “VCTs are a very accessible investment, they deliver a diversified portfolio of early stage unquoted investments that would otherwise be difficult to access without significant investible wealth, with minimum investment sizes starting at around £3,000. Many investors add to their VCT portfolios every year, building a tax efficient tranche of investment in an alternative asset class.
“In light of recent market uncertainty and an increase in risk free returns available to investors, VCTs remain an area where advisers can add meaningful value to their clients and could support them in delivering good outcomes for their clients and business. By building pots of VCT investments, investors can create a tax free income steam which enables current year income tax planning and adds an asset class to their portfolios that would otherwise likely be out of reach”.
The share offer is open until 30 January 2025 but may close earlier if fully subscribed. The minimum investment is £3,000 while the maximum VCT investment qualifying for tax relief is £200,000.
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