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Octopus launches new fundraise for Titan VCT


Octopus Investments, a provider of venture capital trusts (VCTs) in the UK, has launched a GBP70 million fundraise for Octopus Titan Venture Capital Trust.

With over GBP309 million in assets under management, Titan VCT is the largest VCT on the market and has a strong track record of delivering returns for investors.
Since it was first launched in 2007 it has focused on investing into early stage companies with the potential for high growth.
Today the VCT offers investors access to a well-established and diverse portfolio of around 50 smaller companies. These range from very young early stage businesses to well-known household names including Secret Escapes, the members-only holiday company.
In recent years, in light of continuing changes to pensions, many investors and financial advisers have asked for a VCT which could accept monthly contributions. Titan VCT is the first VCT in the UK to offer this service. Direct debits will be taken monthly with new shares issued at around three monthly intervals.
Alex Macpherson, head of the ventures team at Octopus and fund manager of the Titan VCT, says: “Titan VCT offers investors the opportunity to access a really exciting and unique portfolio of early stage companies that has been built up over the last nine years. Every year, we handpick a small selection of new investments from a pipeline of hundreds, and then work with the management teams to help those businesses realise their full potential.
“In the last six months, we’ve been delighted to see Titan VCT-backed companies acquired by fantastic global businesses including Microsoft and Twitter indicating the commercial strength and talent of the UK’s young businesses. This latest fundraise gives investors the opportunity to support both established and developing portfolio companies as well as new businesses. The entrepreneurial scene in the UK is thriving, and as the largest VCT in the UK, we are lucky enough to attract some of the best investment opportunities within this sector and work with some of the most talented entrepreneurs.”
VCTs were introduced by the government in 1995 to encourage investment into the UK’s smaller companies, driving job creation and economic growth in the process. Since then, they have proved to be a vital source of funding, and have played a critical role in helping to support the next generation of UK businesses.
VCTs offer a number of attractive tax incentives for those investors comfortable with the risks associated with smaller company investments. These include up to 30 per cent upfront income tax relief providing that shares in the VCT are held for at least five years, as well as tax-free dividends and tax-free growth.
Titan VCT has announced total dividends of 61p per share to investors since it was first launched.
As new restrictions on lifetime and annual pension investment limits came into force from 6 April, increasing numbers of people are looking at other tax efficient investment options for their retirement planning. With the classic buy-to-let investment also coming under pressure from the chancellor, many may be looking to VCTs as a complementary option for their retirement portfolios.
Paul Latham, managing director at Octopus Investments, says: "This fundraise comes at an inflection point for the industry. Against the backdrop of significant pension reform, we are seeing more and more people looking for ways to complement their existing retirement planning. Many of these customers have asked us to design a VCT which could accept monthly contributions to complement how most people manage their existing retirement plans. With shares allotted quarterly, we are delighted that Titan VCT will be the first VCT to offer this service to customers.
“Last year's fundraise saw unprecedented interest from investors with Titan VCT seeing a record GBP100 million raised, closing five months early. VCTs are now seen by many as a powerful planning tool and can be an attractive way to gain access to the growth potential of smaller, early stage companies."
The share offer is open until 22 August 2017, but may close earlier. The minimum investment is GBP3,000. The maximum investment still qualifying for tax relief is GBP200,000.

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