Manchester-based venture capital investor and small business lender Praetura has launched a new venture capital trust, Praetura Growth VCT plc, as it expands its suite of tax-efficient offerings to investors.
Praetura Growth VCT plc will primarily focus on investing in companies based in the North of England, enabling investors to diversify their portfolio with access to high growth businesses in innovation hubs outside London.
Shares in the VCT will be admitted to the London Stock Exchange, with Praetura seeking to raise an initial £10m to invest in growth businesses with demonstrable traction and exceptional founders. The directors of the VCT and people associated to Praetura have already collectively committed to investing £1.02m to the raise.
Praetura has opened Praetura Growth VCT plc to investors, alongside continuing to offer the Praetura EIS Growth Fund and Praetura Inheritance Tax Planning Service, which enable investors to back early-stage businesses and manage their potential inheritance tax liabilities respectively.
Through its financial adviser base, Praetura has uniquely positioned itself to offer retail investors – otherwise known as individual, non-professional investors - access to a number of alternative asset classes, including high-growth regional tech companies for both EIS and VCT, and the market for asset-secured commercial loans to UK SMEs for its business relief (BR) service.
Coinciding with the launch, the group has established a new division to house its growing range of alternative retail investment offerings, Praetura Investments.
At the same time, Praetura has appointed former Puma Investments COO of eight years Sam McArthur as a partner. McArthur successfully launched several VCT and EIS funds, and grew Puma’s assets under management from circa £100 million to circa £950 million during his time there. In his new role, he will help expand Praetura Investments’ range of alternative retail investment offerings and outreach to financial advisers across the UK.
McArthur, alongside Praetura partner Jon Prescott, will also be responsible for forging relationships with investors and advisers, as well as driving plans to double the size of the Praetura’s distribution and client services teams. The business plans to appoint key hires across the UK, including Scotland, the Midlands and the South East of England.
Sam McArthur, partner at Praetura Investments, said: “The demand for alternative investments is growing significantly. Investors are looking for solutions to diversify their portfolio and deliver strong returns, especially at a time where inflation is continuing to rise and volatility in the stock market, which affects index funds. Praetura’s reputation for providing ‘more than money’, combined with the team’s knowledge of the North and passion for backing exceptional businesses outside of London, offers investors a way to do that. These are factors that encouraged me to join Praetura in the first place, and I’m looking forward to seeing how far we can take our VCT.
“I believe there’s also a greater awareness of VCTs now and the tax efficiencies they can provide investors, as well as ISAs and pensions. There’s even been a noticeable widening of demographics in terms of the sorts of people who are investing and seeking alternative investment solutions. There are multiple reasons for this, including more financial advisers advocating VCTs to their clients and a rise in the number of highly innovative start-ups in the UK in sectors such as tech and health. Unlike VCTs, pensions and ISAs rarely give investors access to these unquoted companies, which is why VCTs lend themselves to investors wanting to diversify into private markets.”
Praetura will leverage its 12 years of successful investments into some of the North’s brightest businesses, delivering a 2.9x average return to date on exited businesses.
The announcement follows the success of Praetura’s EIS Growth Fund, which has backed over 37 companies since launching in 2019, including success stories such as Peak, BankiFi, Patchwork, Culture Shift and XR Games.
To find out more about Praetura Growth VCT plc, visit: www.praeturainvestments.com
