VCT fundraising in 2016-17 – infographic

The total amount raised by VCTs in 2016/17 demonstrated the strongest demand in a decade. But which offers raised the most? Which closed earliest – and which raised money the fastest?

The answers might surprise you. We put together an infographic showing the offers that opened in the 2016/17 tax year. 

Offers are listed in the order they closed. The size of the circle indicates the amount raised. Two circles indicates over-allotment, where the initial target is met and the offer is extended.

Click on the image below to open a larger version of the chart.

Notes on this chart
  • The figures are based on data supplied to Wealth Club directly by the VCT managers
  • For each VCT the ‘meteorite tail’ begins at the opening date. The circle is centred either at the date the offer closed, or the tax year deadline. We haven’t plotted intermediate fundraising amounts and dates, just the open, close and overallotment dates where applicable.
  • Where several VCTs raised funds in parallel these are represented as one offer (e.g. the six Albion VCTs, three Northern VCTs and two each of Amati, Hargreave Hale and Octopus AIM VCTs). Where VCTs from the same manager raised funds separately these each have a plot on the chart (e.g. British Smaller Companies).
  • The British Smaller Companies VCT top-up offer was fully subscribed by 28 February so this is where we plotted the closing date; the offer remained open until 6 March but subscriptions were allotted by ballot.
  • Data tables can be found at the foot of this article.

Fund raising leaders

Octopus Titan VCT stands out as the individual VCT that raised the most – £120 million, including a £50 million over-allotment. This is perhaps not surprising, considering that it raised £100 million last year and is the UK’s largest VCT by assets under management (£426 million). It also allows monthly investment. This offer was open the longest, commencing 23 August 2016 and closing after over-allotment on 6 March.

At 3× the size of the next largest offer, the gulf in fund raising reflects the high profile of this VCT, which has had some notable exits in recent years, including the first VCT-backed £1 billion company, Zoopla Property Group. Remember, past performance is not a guide to the future.

Octopus also raised the most as a group, with its four VCTs (Titan, Apollo, AIM & AIM 2) raising a combined total of £148.6 million.

Early closers

VCT investors were warned that capacity in many popular funds would be scarce – and so it proved, with closing dates arriving earlier than in recent years.

Of the 20 offers shown, 9 had closed by the end of February. By the end of March, 16 had closed. Only four VCTs were still open at the tax year deadline.

The first to close was the British Smaller Companies 2 VCT top-up offer on 10 January, setting the scene for an earlier rush for VCTs than in previous tax years. Both British Smaller Companies VCTs met their top-up offer targets from existing investors.

ProVen Growth & Income, managed by Beringea, was the next VCT to close (31 January), and raised the third largest amount (£39.2 million). This was not only higher than last year’s fund raise by the same manager (£33.8 million for ProVen VCT) but also closed much earlier in the tax year, reflecting the urgency of investor demand. Shane Elliott of Beringea commented that the offer raised the majority of funds before January thanks to an early-bird offer on the fund’s initial charge. The VCT triggered an over-allotment on 18 January; unlike most other offers the managers decided to commit to a closing date rather than let the offer run to its maximum amount, so that late-stage subscribers would not be disappointed.

Fast finishers

Foresight VCT raised the second largest amount at £40 million, over a period of just 46 days (2 February to 20 March). This was the third fastest overall raise – and once the initial target was met, it raised the quickest over-allotment (£20 million in 12 days, a rate of £1.67M/day).

The fastest overall raise was by the three Northern VCTs, which met their combined target of £12.9 million within 48 hours from existing investors. These top-up offers had been announced nearly four weeks in advance of the opening date, which contributed to the speed of the offer selling out – at a rate of £6.45 million per day it was by far the most rapid rate of subscription. (This is why its meteorite tail doesn’t appear on the chart; it’s obscured by the size of the circle.)

Unicorn AIM VCT also raised its target rapidly – £15 million in 15 days. This was the fastest raise among the AIM sector of VCTs. Unicorn is well known for smaller company investing (it also runs unit trusts in this sector) and AIM in particular; the same manager, Chris Hutchinson, also runs the Unicorn AIM IHT ISA. The largest fundraise in the AIM sector was £25 million by Hargreave Hale across its two VCTs. 

Triple Point Income stands out as an offer that noticeably increased its fundraising velocity after announcing an over-allotment (from £0.18M/day to £0.88M/day, a 4.9× increase). Albion’s offer by contrast is the only one that slowed during over-allotment (from £0.40M/day to £0.34M/day); we’re not sure why this might be, however there was an early-bird offer that attracted initial subscriptions quickly. It was the fourth largest offer in terms of total sum raised across its six VCTs.

Finally, Elderstreet VCT’s £14.8 million raise may not stand out on the chart but it’s a significantly higher sum than this VCT has raised in previous tax years. The directors chose to raise a higher amount after joining forces with Draper Esprit, which potentially opens the doors to a higher deal flow.

Current VCT investment opportunities

Although many of the offers available last tax year have closed, some VCTs are currently open for investment.

If you are comfortable with the risks and believe VCTs may be for you, there are two good reasons to consider investing at the start of the tax year rather than waiting until 2018. First, you could receive an extra year’s worth of dividends (variable and not guaranteed). Second, the tax relief can be paid to you during the year rather than reclaimed back afterwards via your tax return.

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Tables: VCT offers 2016-17

Fundraising amounts and dates

VCT Opened Announced overallotment Fundraising at date1 (£M) Closed Fundraising total2 (£M)
British Smaller Companies 2 03/01/2017 - - 10/01/2017 4.3
ProVen Growth & Income 21/09/2016 18/01/2017 30.0 31/01/2017 39.2
Calculus VCT 25/11/2016 - - 02/02/2017 4.0
Unicorn AIM VCT 19/01/2017 - - 03/02/2017 15.0
Maven Income & Growth 6 09/12/2016 17/01/2017 6.0 07/02/2017 8.0
Northern VCTs 07/02/2017 - - 09/02/2017 12.9
Albion VCTs 29/11/2016 24/01/2017 24.0 22/02/2017 34.0
Octopus AIM VCTs 06/02/2017 - - 28/02/2017 8.6
British Smaller Companies 10/02/2017 - - 28/02/2017 4.3
Octopus Titan 23/08/2016 27/01/2017 70.0 06/03/2017 120.0
Octopus Apollo 04/11/2016 - - 09/03/2017 20.0
Hargreave Hale AIM VCTs 14/12/2016 - - 15/03/2017 25.0
Foresight VCT 02/02/2017 08/03/2017 20.0 20/03/2017 40.0
Amati AIM VCTs 09/11/2016 - - 23/03/2017 8.0
Triple Point Income 07/10/2016 10/03/2017 15.0 27/03/2017 30.0
Foresight 3 VCT 22/03/2017 - - 31/03/2017 3.4
Pembroke 15/11/2016 - - 05/04/2017 13.2
Elderstreet VCT 12/12/2016 02/03/2017 10.0 05/04/2017 14.8
Downing FOUR Generalist 08/12/2016 29/03/2017 20.0 05/04/2017 27.3
Downing FOUR Healthcare 08/12/2016 - - 05/04/2017 5.8
  1. If a VCT announced overallotment, how much had been raised at that point
  2. Total funds raised at closing date or tax year end, including over-allotment

Rate of fundraising

VCT Days open (total) £M total / day Days of overallotment £M overallotment / day
British Smaller Companies 2 7 0.61 - -
ProVen Growth & Income 132 0.30 13 0.71
Calculus VCT 69 0.06 - -
Unicorn AIM VCT 15 1.00 - -
Maven Income & Growth 6 60 0.13 21 0.10
Northern VCTs 2 6.45 - -
Albion VCTs 85 0.40 29 0.34
Octopus AIM VCTs 22 0.39 - -
British Smaller Companies 18 0.24 - -
Octopus Titan 195 0.62 38 1.32
Octopus Apollo 125 0.16 - -
Hargreave Hale AIM VCTs 91 0.27 - -
Foresight VCT 46 0.87 12 1.67
Amati AIM VCTs 134 0.06 - -
Triple Point Income 171 0.18 17 0.88
Foresight 3 VCT 9 0.38 - -
Pembroke 141 0.09 - -
Elderstreet VCT 114 0.13 34 0.14
Downing FOUR Generalist 118 0.23 7 1.04
Downing FOUR Healthcare 118 0.05 - -

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