Why you should be excited about venture capital in the UK

by | Nov 28, 2022

Share this article

For professional advisers and paraplanners only. Not to be relied upon by retail investors.

When the economic environment gets more challenging, you’d think fewer opportunities to invest in game-changing innovative companies spring up, right?

Now, this might surprise you.

 

Some of the best-known businesses backed by venture capital were formed in the doom and gloom of uncertain periods.

There’s Zoopla, Uber, and Airbnb. They all flourished in the wake of the 2008 financial crisis. 

So, what’s going on?

 

Periods of recession bring about difficult conditions for all businesses.

What you might not realise is that for investors in early-stage businesses, these very same conditions can also create compelling conditions for entrepreneurs.

Malcolm Ferguson, a fund manager at Octopus Ventures, explains:  “We may be in the best period in over a decade to start, and therefore invest into, a new company.”

 

“Some of the biggest household names were formed the last time we faced a challenging global economic environment.”

“Although new challenges and headwinds exist in 2022, there are a number of very powerful tailwinds.”

“As unemployment rises, we expect to see better availability of top talent. Scarcity of funding should reduce the level of competition around investing in the best businesses. And we’d expect incumbents to cut investment in innovation, creating windows of opportunity for new start-ups.”

 

“All in all, we’re very excited about what the next few years have in store for the UK venture capital ecosystem.”

So how can you help your clients access these investment opportunities in the current economic environment?

Get behind the scenes of venture capital investing in these in-person seminars

Taking place across 20 locations, starting from 5 January 2023, Octopus Investments is hosting tax year end seminars focused on venture capital investing. You’ll hear directly from the investment managers at Octopus Ventures, one of the largest venture capital investment teams in Europe1, and from some of the early-stage companies Octopus invests in.  

 

What to expect: 

  • A panel of venture capital investment specialists join from the studio for a Q&A. 
  • Why there’s a huge opportunity in venture investing right now. 
  • Hear from the founders of inspiring venture-backed companies.  
  • How to access venture capital through Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) investments. And why your clients should consider these investments as  tax year end approaches. 

Secure your place >>

Key risks to bear in mind

  • The value of an investment, and any income from it, can fall as well as rise. Investors may not get back the full amount they invest.
  • Tax treatment depends on individual circumstances and tax rules may change in the future.
  • Tax relief depends on portfolio companies maintaining their qualifying status.
  • VCT and EIS investments are by their nature high risk, their share price may be volatile and they may be hard to sell.

12021 Annual Interactive Global League Tables, PitchBook, 4 March 2022.

 

In regards to VCTs, this advertisement is not a prospectus. Investors should only subscribe for shares based on information in the prospectus and Key Information Document (KID), which can be obtained from octopusinvestments.com. Personal opinions may change and should not be seen as advice or a recommendation. Issued by Octopus Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 33 Holborn, London EC1N 2HT. Registered in England and Wales No. 03942880. We record telephone calls. Issued: November 2022. CAM012525.

Advertisement

Share this article

Related articles

Fit for the future

Fit for the future

Jeffrey Faustin, Chief Investment Officer at Jenson Funding Partners, discussed with GBI Magazine how his team are utilising various methods of diversification to ensure their EIS and SEIS portfolios are as robust as possible to meet investors’ needs. Jenson Funding...

Trending articles

IFA Talk logo

IFA Talk is our flagship podcast, designed to fit perfectly into your busy life, bringing the latest insight, analysis, news and interviews to you, wherever you are.

IFA Talk Podcast - listen to the latest episode