Octopus Investments has launched a £40m fundraise for its Apollo venture capital trust.
The VCT focuses on fast-growing B2B software businesses, and is run by an investment team of 12 within Octopus Ventures.
The companies it invests in are early-stage and high-risk, though Octopus said they tend to be more established with existing recurring revenues and the potential for significant expansion.
Richard Court, fund manager for Apollo VCT, said this time last year the team was talking about remote working and the technology needed in order to adapt to new working patterns.
“Fast forward 12 months and we’re now seeing very significant changes permeate almost every sector imaginable as businesses invest heavily in new technology solutions to increase efficiency and future-proof their operations.
"It’s safe to say that software adoption is still massively on the rise."
He added: “We’re very excited by the opportunity for international expansion among software companies as the barriers to trade are much lower compared to other sectors.
"Almost any customer in the world can now trial your product at the click of a button and there are still huge untapped markets. This means businesses can reach significant scale, even within relatively ‘niche’ sectors."
He said the pipeline for new investments "has never been stronger".
Jessica Franks, head of retail investment products at Octopus Investments, added: “Restrictions on pension contributions have been driving demand for VCTs for some years now, as has the limited investments capable of providing an income stream.
"The recent announcement that tax on dividends will increase should make VCTs even more attractive since the dividends they pay are income tax free.”
In August, the chief executive of Wealth Club said VCTs are becoming increasingly mainstream.
Alex Davies said the speedy fundraise by Amati AIM VCT that month was evidence of the growing interest in the funds.
Amati’s fund, the first to launch an offer in the current tax year, raised its £40m fundraising target in four working days, making it one of the quickest fund raises for a large VCT, according to Wealth Club.
sally.hickey@ft.com
