Update: second profitable exit for Wealth Club investors in Fuel Ventures EIS 2019/20 tranche
Archived article
Archived article: please remember tax and investment rules and circumstances can change over time. This article reflects our views at the time of publication.
On 2 September, Fuel Ventures announced one of its EIS portfolio companies, Capdesk, had been acquired by US fintech unicorn Carta for an undisclosed amount. The transaction represents an 8.5x overall gain for Fuel Ventures’ March 2019 investment and a 3.8x gain for its March/April 2020 investment.
Capdesk was founded in 2015 to help private companies – from seed to pre-IPO stage – keep track of and manage their cap tables, shareholder registers, and employee shares: an easy and effective alternative to messy spreadsheets.
Over 3,500 of Europe’s fastest-growing startups — including Gousto and Checkout.com — use Capdesk’s platform to manage their share ownership. It currently oversees more than £90 billion of assets.
Fuel Ventures first invested £1.0 million into the business in March 2019 and provided a further £1.4 million in follow-on funding in March and April 2020.
Past performance is not a guide to the future. EIS investments are high-risk and illiquid – you could lose all the capital you invest.
Important: The information on this website is for experienced investors. It is not advice nor a research or personal recommendation to invest. If you’re unsure, please seek advice. Investments are for the long term. They are high risk and illiquid and can fall as well as rise in value: you could lose all the money you invest.
How could this exit affect Wealth Club investors?
The acquisition will be welcome news for a number of Wealth Club clients who invested in the 2019/20 tranche.
The sale of Capdesk is the second exit from the fund. There are three other companies remaining in the tranche portfolio. They have all experienced valuation uplifts, although there are no guarantees, of course, they will be realised at a profit or at all.
Wealth Club clients who invested £20,000 in March 2020 could have now received £25,026 capital back and have an unrealised portfolio valued at £75,554. This is before taking into account any tax relief. Remember, early-stage businesses have a high chance of failure and only a few will be outstanding successes. Any exit within three years means tax relief is withdrawn.
2019/20 tranche performance per £20,000 invested
| Portfolio company | Investment | Unrealised value | Realised value | Total value |
|---|---|---|---|---|
| Arbolus | £3,999 | £20,981 | — | £20,981 |
| Capdesk | £3,999 | £11,034* | £4,020* | £15,054 |
| ContentCal | £4,000 | £3,266 | £21,006 | £24,272 |
| Distributed | £4,000 | £7,132 | — | £7,132 |
| OnBuy | £4,000 | £33,141 | — | £33,141 |
| £20,000 | £75,554 | £25,026 | £100,580 |
* These reflect the fact the transaction was a mix of cash (shown as "realised" above) and non-cash proceeds whose final value is at least partially dependent on future performance (shown as "unrealised" above).
Source: Fuel Ventures, as at 13 September 2022. Past performance is not a guide to future performance. The table shows realised returns (where share proceeds have been returned to investors as cash) and unrealised returns (where cash has not yet been returned and the value of the investments is based on the manager’s own valuation methodology) for investors in the tranche. There is no ready market for unlisted shares. The figures shown do not include any income tax relief or loss relief. Fuel Ventures charges a performance fee of 20% on returns to investors in excess of £1.20 per £1 invested on a portfolio basis, which may impact investors' returns. Figures are net of all other fees.
Performance of all Fuel EIS-qualifying investments per £100 per tax year
Source: Fuel Ventures, as at 13 September 2022. Past performance is not a guide to future performance. The chart shows realised returns (where share proceeds have been returned to investors as cash) and unrealised returns (where cash has not yet been returned and the value of the investments is based on the manager’s own valuation methodology). There is no ready market for unlisted shares. The figures shown are net of all fees and do not include any income tax relief or loss relief.
About Fuel Ventures
Fuel Ventures is one of the UK’s most active early and growth stage investors, with a focus on fast-growing technology businesses.
Fuel Ventures was set up and is run by Mark Pearson, founder of MyVoucherCodes. Mark reportedly sold myVoucherCodes, via its parent company, for £55 million in 2014. He’s since invested personally in several early-stage digital businesses and set up Fuel Ventures in 2013.
Fuel Ventures runs two EIS funds and one SEIS fund. Mark has personally committed to investing alongside investors in the funds.
The Fuel Ventures Scale-up EIS Fund is currently open. The minimum investment is £20,000 and the deadline for the next close is 17 October.
Wealth Club aims to make it easier for experienced investors to find information on – and apply for – investments. You should base your investment decision on the offer documents and ensure you have read and fully understand them before investing. The information on this webpage is a marketing communication. It is not advice or a personal or research recommendation to buy any of the investments mentioned, nor does it include any opinion as to the present or future value or price of these investments. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.