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Octopus Future Generations VCT launched in January 2022, with a sustainability theme. It looks to invest across three core areas: building a sustainable planet, empowering people, and revitalising healthcare.
The VCT is managed by Octopus Ventures, a leading venture capital team and manager of VCTs including Octopus Titan VCT, the UK’s largest. Octopus Ventures has developed a reputation for backing some of the UK’s fastest-growing private technology companies, some of which have been acquired by the likes of Google, Microsoft and Amazon.
The Future Generations VCT aims to combine Octopus’s experience as a growth investor with its belief that some of the best returns will increasingly come from companies solving society’s biggest problems.
As at 30 June 2024, the VCT had net assets of £46.1 million and a portfolio of 36 companies. The VCT does not expect to begin paying dividends until at least 2026, with a longer-term aim to pay an annual dividend of 5%. Dividends are variable and not guaranteed.
- Seeking to raise £5 million with £5 million overallotment facility
- Targeting annual dividend of 5% of NAV per share – from 2026, dividends are variable and not guaranteed
- Available for the 2024/25 tax year
- Minimum investment £3,000 – you can apply online
- Deadline: 1 April 2025 (5pm) for 2.0% early bird saving
Important: The information on this website is for experienced investors. It is not a 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.
The manager
Octopus Investments was launched in 2000. Today, the group has over 750 employees and manages £10.5 billion on behalf of over 63,000 retail investors, charities and institutions, including pension funds, fund-of-funds and family offices (September 2024).
Octopus Ventures, a dedicated business unit in Octopus Group, is the VCT manager. It manages a total of £1.7 billion across its funds, including Octopus’s VCTs and EIS funds, as well as several follow-on funds used to support companies once they outgrow the VCTs (September 2024).
The Octopus Future Generations VCT focused team is made up of eight investment managers, alongside a support network of over 30 individuals, including a talent team dedicated to helping portfolio companies hire the best people, as well as legal, operational, and administrative support. Before joining Octopus, many of the team were well-established in other industries, such as consumer goods, professional services, and technology.
In February 2021, Octopus Group became a B Corporation (B Corp.) – joining a network of nearly 9,500 companies. B Corp. is a certification from an independent organisation that a company operates at the highest standards of social and environmental performance, accountability, and transparency.
Meet the manager
Simon King, Octopus Ventures – watch the interview
Investment strategy
The Octopus Future Generations VCT aims to blend growth and sustainability – and will assess companies against both. It targets ambitious businesses with the potential to transform outdated industries for the better, while also demonstrating excellent growth prospects.
Growth strategy
The VCT follows the same mandate and selection process as Octopus Titan VCT, targeting companies developing innovative technologies and operating in large and fast-growing markets. The team only considers businesses it believes have the potential to deliver 10x on the initial investment – although these are high risk, so the team expects some to fail.
The quality of the investee company’s management team remains the most important driver of investment decisions. Octopus looks for “unusually talented” entrepreneurs, with whom it can build long-term and mutually beneficial relationships.
Due to its size and position in the market, the Octopus Ventures team engages with thousands of businesses every year and expects to invest in less than 1% of them.
Sustainability themes
In addition, the Future Generations VCT will apply an extra layer of due diligence, assessing each opportunity against its three core themes:
- Building a sustainable planet: this might include businesses focusing on reducing carbon emissions, protecting ecosystems, and using the circular economy to reduce waste, for instance.
- Empowering people: these businesses could range from the democratisation of education or financial services to the protection of online privacy and the improvement of connectivity between people.
- Revitalising healthcare: this might include businesses that are using digitisation and technology to make healthcare services more accessible and efficient.
For a company to receive investment from the VCT it must demonstrate alignment to at least one theme. Furthermore, companies will be subject to enhanced reporting requirements, allowing Octopus to measure progress against social and environmental goals as well as financial performance.
Portfolio overview
The VCT first issued shares in April 2022. It aims to build a portfolio of growth capital investments, split across its three sustainability themes.
The VCT has net assets of £46.1 million (June 2024): £28.6 million invested in 36 companies and the rest in money market funds and cash.
In the 12 months to June 2024, the VCT invested £7.2 million in 13 new companies. Post-period end it made four further investments including two new and two follow-on investments totalling £1 million.
Investment portfolio by theme %
Source: Octopus Ventures, 30 June 2024
Examples of portfolio companies
Largest holding (revitalising healthcare)
HelloSelf
Charlie Wells, founder, suffered a brain haemorrhage in his late 20s and became obsessed with ‘self-optimisation’ during his recovery. In particular, he was interested in measuring his brain performance and set out to build a digital therapy platform to help others do the same.
His company, HelloSelf, helps users understand their own psychology and receive personalised advice from a therapist or coach depending on their specific needs. Between sessions, users receive AI-enhanced support alongside “homework” to help them track their progress. There is also a self-led plan for those who graduate from therapy and can manage themselves.
As well as being available privately, where sessions start from £110, the platform works with employers and health insurers such as Bupa and AXA.
Octopus led a £16.6 million Series B funding round in January 2023 with the Octopus Future Generations VCT investing £2.6 million. The holding is currently valued at cost.
Recent investment (empowering people)
Swiipr Technologies
Nearly everyone has dealt with flight disruptions and the almost inevitable delay in receiving compensation from airlines.
The problem often lies in outdated systems which make it difficult for airlines to quickly verify passengers and issue payouts. Swiipr aims to fix this.
Through Swiipr, airlines can issue instant compensation through virtual or physical cards. This not only offers passengers flexibility to spend where they choose but is also easy to top-up if delays continue. In turn, airlines can benefit from a 60% reduction in administration costs while delivering better customer service.
The company already works with over 200 airports and 26 airlines, including British Airways, Iberia, and Air India.
Octopus led Swiipr’s £6 million Series A round in May 2024, with the Octopus Future Generations VCT investing c.£600,000.
Exit track record
As this is a still a relatively young VCT, its exit track record is limited with one exit (Cobee, detailed below) achieved to date. As at the end of June 2024, the VCT had seen no failures. Past performance is not a guide to the future.
Example of a recent exit
Cobee
Pitched as the “all-in-one benefits platform”, Cobee makes it easier for companies to manage their employee benefits schemes.
With the average millennial changing jobs every few years, companies are under pressure to offer additional benefits to attract top talent. However, this means HR departments have to manage providers and track employee eligibility and usage.
Through Cobee’s platform, companies can save time and money. They can manage all their schemes, customise benefit plans, offer flexible schemes, and add new benefits with just one click. Meanwhile, employees can access all their benefits and discounts using a single card.
Octopus Ventures co-led the company’s €40 million Series B funding round alongside Notion Capital in November 2022, with Octopus Future Generations VCT investing £1.9 million. The VCT followed on in March 2023, taking its total investment to £2.6 million. The position was valued at £3.7 million in June 2024, past performance is not a guide to the future.
In September 2024, Cobee was acquired by French group Pluxee. Terms of the deal have not yet been confirmed.
Performance and dividends
As the VCT first issued shares in April 2022 its performance track record is limited. However, Octopus Ventures has a reputation for backing some of the UK’s fastest-growing private technology companies.
The VCT targets an annual dividend of 5% but does not expect to begin paying dividends until at least 2026, dividends are variable and not guaranteed.
NAV and cumulative dividends per share over five years (p)
Source: Morningstar. Past performance is no guide to the future. Dividends are variable and not guaranteed. The bar chart shows net asset value and cumulative dividends per share for the period 31/12/2022 to 30/06/2025.
Dividend Reinvestment Scheme
The VCT does not expect to pay a dividend until at least 2025. The company has adopted a Dividend Reinvestment Scheme under which shareholders can reinvest future dividend payments by way of subscription for new shares. As these are new shares they should be eligible for tax relief (you will need to claim this on your tax return or directly with HMRC) and the shares will count towards the VCT annual subscription limit.
Share buybacks
The board intends to buy back shares at up to a 5% discount to the prevailing net asset value. This is not guaranteed and is not expected to be generally available before 2025 – please see the offer documents for details.
Discount history
VCT shares are traded on the London Stock Exchange. Similar to investment trusts, the share price can fluctuate and can be different from the VCT’s net asset value (NAV), i.e. the value of the VCT’s underlying investments. The difference between the share price of a VCT and its net asset value per share is called a discount.
Investors should note the VCT has less than a five-year track record. Trading of the VCTs shares will be immaterial and any consideration of the share price movements in relation to the net asset value per share will be inconclusive. The discount history will be published once the VCT has a five-year track record.
Investors looking to sell their VCT shares may get a better price using the VCT’s share buyback facility, although this is not guaranteed.
Risks: important
This, like all investments available through Wealth Club, is only for experienced investors happy to make their own investment decisions without advice.
VCTs are high-risk so should only form part of a balanced portfolio and you should not invest money you cannot afford to lose. They also tend to be illiquid and hard to sell and value. Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks.
To retain the tax benefits, VCTs should be held for at least five years. If you sell VCT shares and reinvest in new shares of the same VCT (including any mergers) within six months, tax relief can be restricted. Tax rules can change and benefits depend on circumstances.
As this is a new VCT it will take time to build a portfolio of investments, during this time the trust is likely to be more concentrated and no dividend payments are expected until at least 2026.
Charges and savings
A summary of the main charges and savings is shown below. The net initial charge shown includes the Wealth Club saving and any early bird discount. The investment may have additional charges and expenses: please see the provider documents including the Key Information Document for more details.
Please note, capacity – for the offer or any early bird savings – can be reached early, and we may not be notified of this by the VCT in real time.
Shareholders in any of the Octopus VCTs are eligible for the 1% existing investor discount.
Octopus will donate 10% of its annual management charge to its charitable foundation, Octopus Giving.
| Full initial charge | 3% |
| Early bird discount | 2% |
| Wealth Club initial saving | — |
| Existing investor discount | 1% |
| Net initial charge through Wealth Club (new investors) | 1% |
| Net initial charge through Wealth Club (existing investors) | 0% |
| Annual management charge | 2% |
| Annual administration charge | 0.3% |
| Performance fee | 20% |
| Annual rebate from Wealth Club (for three years) | 0.10% |
More detail on the charges
The full initial charge shown in the table above is before any savings and discounts; the net initial charge is after available savings and discounts. When you invest through us, Wealth Club will receive commission each year (up to 0.5%). Commission is paid by the product provider so there is no additional charge to you.
Please see the provider’s documents, including the key information document, for more details on the total fees and charges.
Annual rebate when you invest through Wealth Club
The Octopus Future Generations VCT includes an annual rebate for Wealth Club investors, payable for the first three years. This is a rebate of our renewal commission and should be equivalent to a percentage (shown in the table above) of the Net Asset Value of the Offer Shares issued to you when you invest. Terms and conditions apply.
Deadlines
- Deadline for early bird saving of 2% and allotment in 2024/25: 1 April 2025 (5pm)
Our view
This offer has several attractive features, in our view.
Firstly, while this is a new mandate, the Octopus Ventures team has a long track record of investing in ambitious, high-growth companies – including Cobee (detailed above), the VCT’s first exit. Over the last two decades, the team has backed some of the UK’s fastest-growing private technology businesses.
The VCT should also benefit from the wider resources of the Octopus Group and its network. Octopus’s reputation in the industry attracts a significant number of investment opportunities, in which the trust can invest alongside Octopus Titan VCT and Octopus Ventures EIS. All three funds are likely to co-invest, allowing the Future Generations VCT to access larger funding rounds not typically available to smaller, newer VCTs.
Finally, Future Generations is the first growth capital VCT to have a specific sustainability theme. Sustainability is an increasingly important consideration, shaping consumer and business spending habits across the globe. Early-stage companies that can offer innovative solutions to address these issues could be well placed for the future.
For experienced investors, this offers an opportunity to access a dedicated, sustainability-themed portfolio managed by one of Europe’s leading venture capital teams.
This financial promotion has been communicated and approved by Wealth Club Ltd on 4 February 2025
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.