Below is a summary of the Downing VCTS launched in the last 10 years:
Downing ONE is shown from the date of the merger. All other are the original launch dates.
This means advisers whose clients are interested in VCT investing, or whose portfolios of investments would benefit from VCTs, will have to be “a bit quicker” in order to get their clients into the best investments or have more choice in what they offer clients, says Callcut. He says that “realism” about the VCT markets suggests that some of the larger VCT providers “will not come out again” for fund raises this year. “They raised a lot last year and what I suspect is there will be smaller top-ups to keep existing shareholders happy, so advisers will have to start looking [on behalf of their clients] early in the tax year,” he says. “There will be some VCT supply left at the end of the tax year but it’s like the supermarket on a Sunday: there is just not as much choice left.”
Better understanding Callcut says the outlook for VCTs is more positive from here because the Patient Capital Review has spelt out to the government exactly what the benefits are.
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GB Investment Magazine · June 2018
“We believe the Patient Capital Review significantly helped government understand the benefits of VCTs. They provide patient capital, support multiple funding rounds for companies, provide a strong payback on the tax relief granted, recycle capital in to new investments and managers add value to their portfolios, to help them succeed,” he says. “In their review they were initially highly negative towards the scheme, but following an extensive dialogue between HM Treasury and the VCT industry, particularly the VCT Association, their view has moderated. There was also a lot of support from other players in the industry who see VCTs as filling a critical funding gap.” With the lines of communication now open, and a better understanding of VCTs, the only way is up for the alternative investment.