Venture capital trusts were the flavour of the month exactly 1 year ago – products were literally flying off the shelves. The story today is markedly different.
There are 12 VCTs open and the majority have raised minimal amounts. Only the quality names have so far raised anything resembling serious amounts of money. The latest name to enter the fray is Baronsmead 4.
David Thorp, joint MD of the newly named Isis Capital, is lead manager of the fund and is ably backed by what seems like a team of millions.
The easiest way to describe this VCT is more of the same. Baronsmead 1, 2 and 3 all have enviable track records. The investment strategy used is a “top down, sectordriven” approach and will invest in both established and also technology-enabled companies.
The fund will focus on five sectors – IT, healthcare & life sciences, consumer markets, media & communications and business services.
Although the smallest sector at present, David Thorp expects healthcare & life sciences to become a large part of the portfolio in the coming few years. In every sector, pricing power and scalability are important factors when identifying pros-pective investments.
Isis Capital is one of the biggest and most experienced VCT managers currently in the market in terms of money under management and investment professionals. This size means that there is plenty of opportunity for co-investment in addition to a high proportion of top-quality deals coming their way.
Ben Yearsley is an inv-estment manager at Hargreaves Lansdown