Investments  

‘Brexit is a rubbish idea but it is where we are’

Patrick Reeve has come straight from a roundtable with the newly appointed secretary of state for communities and local government, Sajid Javid, just a couple of weeks after the UK voted to leave the EU. He explains Mr Javid had gathered members of the City’s financial industry to discuss the implications of Brexit.

“Really, he was picking our brains as to what our concerns were and what the opportunities were,” he says. “I think there are opportunities to remove some of the layers of legislation that have been around – particularly some of the UK interpretation of EU legislation – and to have a longer term project to remove layers of EU legislation where it’s not needed.”

He clarifies: “From a venture capital trust point of view, quite a lot of the EU state aid provisions seem heavy and restrictive. If some of those could be lifted without damaging the Treasury’s policy objectives, that would be great.”

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But Mr Reeve is far from positive on the wider ramifications of Brexit. Asked about his concerns, he does not hold back.

“My big picture is that now is not the time in the world’s history to show lack of solidarity with allies.

“I think Brexit is a rubbish idea but it is where we are. I think it’s absolutely barmy to weaken our ties with our allies when, actually, the world needs moral leadership and Europe should be a moral leader. It’s silly of us not to be a part of that.”

Mr Reeve’s day job focuses on finding future leaders of a different kind. He is the managing partner at Albion Ventures, a venture capital investor that launched its first venture capital trust (VCT) just over 20 years ago. Having raised £25m back in 1996, the business now has £450m under management.

In the early days, he says the business was trying to invest in the “predictable end” of venture capital.

“We still do that, but now we’ve spread right out into technology – we do a lot in medical technology, life sciences and IT,” he notes.

“We’ve got £300m in VCTs, we’ve got another £50m in a fund we manage jointly with University College London. It’s called the UCL Technology fund and that invests in intellectual property coming out of UCL, with particular strength in life sciences and medical, so that’s really early-stage gene therapy.

“Then we’ve got about £75m in a renewable energy business for portfolio projects and a specialist care home fund as well.”

He believes VCTs have become a more appealing product to investors since the company launched.

“I think VCTs now have a 20-year plus track record and it has been proven they provide decent long-term returns and are a good supplement to a pension,” he says.

“And because they invest in portfolios, or they are themselves a portfolio, they spread the risk very effectively.