Welcome back to another instalment of our series of interviews on GBI Magazine! This time, we are focusing on the results of the UK general election and the changes we can expect to tax-efficient investments with a Labour government. So far, we have spoken to YFM Equity Partners and Symvan Capital, with more in the pipeline!
Joining us for the third instalment is Antoine Pradayrol, the Chief Investment Officer at Green Angel Ventures. Antoine reveals his expectations for the sector following the change of government. He also outlines how the new government has affected his company.
1.) How has the result of the general election affected Green Angel Ventures so far?
Within one week of the election, the new Government announced a range of climate change policies that had not been mentioned in the manifesto. These have immediately brought the climate change issues concerning investment in innovation of the kind Green Angel Ventures manages back onto the public policy agenda.
This is, and will be, a very good thing for our fund, our portfolio companies, and the planet. It is crucial that the new government addresses the neglected areas of technology innovation required to reach Net Zero. In particular, domestic heating, construction, and food and agriculture. These are all vital areas, which have not received enough attention or support thus far, and are at the heart of our work at Green Angel Ventures. We hope to see barriers removed and incentives created by the Government to encourage the rapid mass-market adoption of innovative technologies enabling net zero in these sectors.
2.) Do you think the outcome of the UK election will impact tax policies on investments?
It is already impacting tax policies on energy investment in a thoroughly good way. On 30th July, the Government announced changes in Energy taxes and investment which reduced incentives to invest in Oil & Gas, and increased incentives to invest in renewables. Its announcement emphasised that “the money raised from these measures will support our clean energy transition, increasing security, and providing sustainable jobs for the future”.
* headline rate of tax on upstream Oil & Gas activities up from 75 to 78%
* extended to 31/3/2030
* end to “unjustifiably generous” 29% investment allowance
* 80% decarbonisation investment allowance remains
In the specific asset class of concern to Green Angel Ventures, we are confident that the new Government will maintain the incentives for early stage investment in the SEIS and EIS tax relief schemes.
3.) How will the Labour government’s approach to wealth taxes influence high-net-worth individuals’ investment decisions?
The indications are that the Government will maintain the EIS incentive regime which, in itself, will be a powerful counterbalance to any increases in wealth tax. In this sense, the policies that might be expected are likely to encourage greater investment in certain sectors, to take advantage of tax benefits. However, the degree of uncertainty around utilities nationalisation might mean investment in these sectors will suffer. Volatility can be expected in specific connected markets. In terms of Climate Tech investment, however, Green Angel Ventures expects that the new Government’s recognition of Climate Change as a priority will encourage growth in related investment decisions, regardless of the expected increase in wealth taxes. The urgency of the issues embedded in Climate Change does not permit inertia, whatever the marginal differences in the taxes paid by the wealthy potential and existing investors, as represented by Green Angel Ventures.
Antoine is an experienced early-stage investor focusing on the climate tech space. He joined Green Angel Ventures in 2017, and serves as Chief Investment Officer, in charge of the firm’s fund activities. He has also built a portfolio of 30 investments across the energy transition sector, clean transportation and smart cities, energy efficiency solutions, circular economy, robotics, and ed-tech. Antoine is actively supporting founders as part of Imperial College London’s Venture Mentoring Service, as a Non-exec Director at Zedify and he was a Board Observer with AirEx until 2021.
Prior to joining GAV, Antoine had a successful 15 years career in public equities as an equity research analyst. He was an Executive Director and partner with Exane BNP Paribas, based in London since 2005. Antoine is passionate about companies applying innovative technologies to tackle global warming and climate change. He studied at Ecole Polytechnique (economics and finance) and Telecom ParisTech (technology and telecoms).–
