primarily focuses on pre-series A B2B technology businesses. With high-growth B2B technology businesses accounting for 77% of all exits in 2019, this sector tends to offer better valuation on entry and better returns.4 Supporting dynamic and innovative companies Whilst tax relief is one of the primary appeals of a VCT investment, it is difficult to ignore the role in which they play within the wider UK economy. VCT fundraising in 2022 surpassed the £1 billion milestone for the first time, raising £1.13 billion to be invested in small and innovative UK companies.5 Despite the daunting in-tray which investors face, the benefits of VCT investment have never been greater. It offers an opportunity to both support and capitalise on a wave of British entrepreneurialism emerging from this recessionary period. For business owners, VCT investment allows them to efficiently extract profits from the business at a time when the UK government is slashing the dividend tax allowance. If investors don’t act now and plan ahead by incorporating VCTs into their investment portfolio, they risk being exposed to increasing macroeconomic pressures and foreseeable changes to the UK’s pension and tax systems. 1 https://www.independent.co.uk/money/uk-s-tax-burden-what-do-the- figures-show-b2097564.html 2 https://www.theaic.co.uk/aic/find-compare-investment-companies/ advanced-compare 3 https://www.investopedia.com/articles/personal-finance/040915/how- many-startups-fail-and-why.asp 4 https://www.triplepoint.co.uk/filedownload.php?a=750-5f802c8866add 5 https://www.theaic.co.uk/aic/news/press-releases/smes-to-benefit- from-record-funding-as-vcts-raise-over-a-billion-in-202122 “A successful VCT strategy should follow a key investment criterion ensuring that each early-stage company has an appetite for growth and a path for long-term profitability.” “Over the last ten years, the average net asset value total return for both AIM VCTs and generalist VCTs has been making VCTs not only a tax-efficient vehicle but also a competitive investment product in its own right.2” 101% for the first time, raising “VCT fundraising in 2022 surpassed the £1B Milestone £1.13B to be invested in small and innovative UK companies.5” “With over 20% of start-ups failing within the first five years, implementing the right investment plan can help mitigate the risks that come with investing in earlystage companies.3” Finance Monthly. Inve s tmen t 65
RkJQdWJsaXNoZXIy Mjk3Mzkz