Octopus Investments now lets investors in its £309m venture capital trust make monthly contributions, as it looks to match the way most people save into their pensions.
The Titan VCT, which was first launched in 2007, now also has a minimum investment of £3,000 - as Octopus looks to make it accessible to mainstream investors, as well as high net-worth individuals.
It offers investors access to around 50 smaller companies, ranging from young early-stage businesses to well-known household names.
Octopus has also launched a fresh round of fundraising for the Titan VCT, targeting £70m.
The fund management firm, which is one of the largest providers of VCTs in the UK, claims Titan is the first VCT in the UK to allow phased contributions, with direct debits taken monthly and new shares usually issued every three months.
Paul Latham, managing director at Octopus Investments, said the latest fundraising push comes at an “inflection point” for the industry.
“Against the backdrop of significant pension reform, we are seeing more and more people looking for ways to complement their existing retirement planning,” he stated, adding the Titan VCT saw record fundraising of £100m last year.
“VCTs are now seen by many as a powerful planning tool and can be an attractive way to gain access to the growth potential of smaller, early stage companies.”
The Titan vehicle launched a £50m fundraising round last September to meet growing demand for the asset class.
VCTs were introduced by the government in 1995 to encourage investment into British smaller companies by offering tax incentives, including up to 30 per cent upfront income tax relief.
Alex Macpherson, fund manager of the Titan VCT, said he handpicks a small selection of new investments every year from a “pipeline” of hundreds, which he then works with to help boost business growth.
Tony Catt, compliance officer at Anthony Catt Limited, agreed the minimum total investment of £3,000 will make the fund more accessible to a wider audience.
“While VCT investment is still specialist and represents a relatively high level of investment risk, this size of contribution could mean that more people use it as part of their investment portfolio,” he said, pointing out it adds a little bit of “higher risk zest” to portfolios.
katherine.denham@ft.com
