Triple Point VCT 2011

This is a new offer for the Triple Point 2011 VCT, raising up to £30 million in its new Venture Share Class. The offer seeks to raise up to £15 million with an over-allotment of £15 million.

Highlights

  • New “Venture” Share Class will invest in growth capital opportunities in a range of sectors
  • Raising up to £30 million (£15 million with an over-allotment of £15 million)
  • Initial target dividend of 3p per share from 2020 (not guaranteed)
  • Management team intend to invest in this offer themselves
  • Minimum investment £3,000

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, so you could get back less than you invest.

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The manager

The VCT is managed by Triple Point Investment Management LLP, which has over £900 million total assets under management and a team of over 80.

Triple Point concentrates on four key areas for investment: venture capital; energy and infrastructure; lending, leasing and private debt; and property.

Watch a video interview with Ian McLennan, partner at Triple Point:

The offer

Triple Point VCT 2011 plc (TP11) issued its first shares in April 2011 and has £17.4 million in net assets (as at 28 February 2018). It has raised over £35 million which has been invested in 33 companies (as at 31 March 2018).

The VCT was originally set up as a Limited Life VCT and had an Ordinary share class, which was fully exited in January 2018. It had two further share classes, ‘A’ and ‘B’ shares, which invest in separate portfolios of Scottish hydroelectric power companies, combined heat and power plants, and lending to small and medium sized companies (SMEs).

This offer for the Venture Fund is an entirely new share class within the VCT. It will focus on providing funding to new unquoted companies at an early stage in their lifecycle, across a diversified range of sectors.

The VCT intends to make initial investments of between £50,000 and £2 million and may make further follow-on investments.

The directors intend to invest £75,000 and the Investment Management Team at least £150,000 in the offer, on the same terms as investors.

Investment strategy

Triple Point has forged partnerships with innovation specialists, entrepreneurs, growth consultants, and venture capitalists to form the ‘Venture Network’. 

The partners in the network have established relationships with a number of large corporates, from John Lewis, to BMW and Deloitte. 

They work with those corporates to identify and articulate their specific challenges. The objective is to find – and ultimately invest in – start-ups that can provide a relevant solution. 

Triple Point calls this a ‘challenge-led’ approach. In other words, the investment selection process starts from a large corporate with a specific need, rather than from a start-up with an unproven idea. 

An example of challenge/solution is offered by John Lewis and app developer Qudini.

The challenge was managing John Lewis’s in-store customer journeys, e.g. queues and waiting times. The solution deemed best was a digital queuing system developed by Qudini. John Lewis staff takes names and phone numbers of customers who need assistance on the Qudini app. The app sends automatic SMS updates on waiting times and alerts customers when it’s their turn, alongside other features. 

After a successful eight-week trial, John Lewis decided to start using Qudini across its stores and signed a significant contract. Before the John Lewis contract, Qudini had a valuation of £4.5 million. A subsequent funding round valued it at £14.5 million.

Please note: this example illustrates the types of future investments the Venture Fund aims to make. The success of this company has no bearing on the potential performance of the fund as the Venture Fund did not invest in Qudini. 

Target dividend

The Venture Fund aims to pay regular dividends from 2020, although this is not guaranteed. It is targeting a dividend of 3p per share in the summer of 2020 and 2021 and, subject to realisations, dividends of up to 5p per share thereafter.

Performance

This is a new share class, so performance is not yet available.

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. 

Tax rules can change and benefits depend on circumstances.

VCTs can now only invest new money in growth capital deals. Management buyouts, replacement capital deals and investments in mature companies are no longer permitted. This results in considerably higher risks.

This is a new VCT share class. If fundraising is slow, shares may take some time to be allotted, or may not be allotted at all.

Fees and charges

A summary of the fees and charges for the Venture share offer is shown below. The net initial charge shown includes the Wealth Club discount and early bird saving.

Full initial charge 5.5%
Wealth Club initial saving 3.5%
Net initial charge through Wealth Club 2%
Annual charge 2%
Performance fee 20%

More detail on the charges

Share buy-backs

The Company may operate a buy back policy at a 5% discount to net asset value. Please see the offer documents for details.

Deadlines

Unless the offer is fully subscribed before these dates, the following deadlines apply:

Deadline for early bird discount: 20 December 2018 

Deadline for shares allotted in the 2018/19 tax year: 5 April 2019

Our view

This VCT offers a slightly different approach to other growth capital VCTs. Its "challenge-led" strategy means it aims to invests in businesses that offer a product or service with a known demand, rather than just hoping a bright new idea works. It seeks to reduce risk by partnering the younger firm with existing, established businesses. The VCT is new and unproven - but could be one to consider.

Wealth Club aims to highlight investments we believe have merit, but you should form your own view. You should decide based on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice nor a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination. 15.11.2018

Read important documents and apply

The details

Type
Generalist
Target dividend
3p from 2020
Initial charge
5.5%
Initial saving via Wealth Club
3.5%
Net initial charge
2%
Annual rebate
-
Funds raised / sought
£1.4 million / £15 million
Deadline
20 Dec 2018 for early bird saving

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