Lacomp was founded in 1985 by Peter Buxtorf to provide discretionary portfolio services for an international client base. As the previous three funds are now closed, this fund was established to take advantage of further investment opportunities Lacomp has identified.
The fund’s objective is to provide capital growth over a period of three to five years. An investment advisory panel, headed by Buxtorf, will construct the portfolio. The panel includes Simon Pannet, head of corporate finance at Beer & Partners, which specialises in raising money for small and start up companies.
The panel finds out about potential investments from a variety of sources including direct approaches and through contacts. When a company looks promising, there will be an initial appraisal, which is designed to see whether it is worthwhile paying for full due diligence.
The panel aims to find companies with a good management team behind it, strong cashflow and are experiencing a growing demand for its products and services.
Selected companies are monitored through monthly progress meetings and Lacomp will then look for best exit strategy from the company. This may be a flotation to Aim or Ofex, a management buyout or liquidation and the sale of assets.
Since the last Lacomp fund appeared, there is now a clearer distinction between EISs and VCTs in that the former is attractive from a capital gains tax perspective while the latter focuses on income tax relief. This could enable EISs and EIS funds to find their place in the market without facing strong competition from VCTs.
However, the main drawback of this fund is that because investors’ original capital is divided among more than one company, smaller amounts are invested which could dilute the returns if one is more successful