Independent venture capital firm Quester has announced plans to re-open its most recent venture capital trusts as it seeks further commitments to capitalise on the sharp downturn in valuations in the UK small cap market.
The Quester VCT 5, which closed at £18.6m in May, over 25 per cent below its original target of £25m, is targeting early-stage investments primarily in technology, life sciences, healthcare and communications. The minimum investment is £3,000.
Quester director John Spooner said the recent reduction in company valuations coupled with the reduction in competition for the best deals presented the fund with a broad range of opportunities. “The quality of investment opportunities remains high. Add to that the significantly lower prices that we are paying for these investments, and it seemed obvious to us that reopening Quester VCT 5 would give private investors the opportunity to take advantage of this unique environment.”
VCTs have struggled to attract investors in the current environment. Electra Kingsway VCT, which invests alongside Electra Partners, was one of several funds that have struggled to attract investors. This is stark contrast to the situation in 2001, when Quester VCT 4 managed to raise £50m within four weeks of its launch.
The firm has £200m under management in VCT funds – 13.5 per cent of the total VCT capital under management – making it one of leading VCT fundraisers. Quester VCT 5 has a current portfolio of seven investments spread across a range of sectors and in companies at different stages of development.
In addition to the firm’s five listed VCTs, Quester manages venture capital funds on behalf of international institutional investors and funds from academic institutions including Oxford University.