Jason Rolf - Business Development ManagerJason started his working career on the London International Financial Futures Exchange in 1987, trading interest-rate options for an LSE options market-maker. He became an independent trader shortly after and then founding partner of a large independent options-trading group. During this time he co-founded London Derivatives Options Software Ltd, a software firm that produced one of the first commercially available option pricing models in London. This business ultimately became the foundation of the software firm, FFastfill plc which floated on the AIM market in 2000. Jason's work on option-pricing and trade-execution algorithms for electronic trading introduced him to the field of systematic models where he has concentrated since 2005. He joined Amati as a partner at the end of 2010. He is a current holder of the CFA Investment Management Certificate (IMC). In 2014 Jason served as a director of the London media technology business Mirriad Ltd, an Amati VCT investee company.
HMRC research paper: 'The use and impact of Venture Capital Schemes'
Posted by Jason Rolf on 25/Feb/2016
HMRC commission a recent report by IPSOS MORI to highlight the use and impact of Venture Capital Trusts (VCTs and EIS).
The Government is committed to helping small and innovative UK firms access finance in order that they are able to fulfil their prospects, this is central to their growth strategy. Venture Capital schemes are a core part of this strategy as, through the tax reliefs they offer, they encourage investment into higher-risk and unquoted companies which would otherwise struggle to get finance.
Shareholders of Amati VCTs may find the results interesting including why investee companies require finance and also the expectations of investors themselves and the main reasons behind their decision to use these schemes.
One particularly surprising result was the perception of risk of VCTs, with a number of investors citing the relatively poor performance of the stock market since the 2008 crash against more consistent returns from VCTs. It was also noted that EIS schemes generally focussed on the less mature and start-up company whereas VCTs directed investment towards more established firms that were looking towards expansion capital. Investors in VCTs were also found to be older, possibly retired individuals (although not necessarily High Net Worth) and were looking for continuous dividends to help fund their retirement. Additionally, these investors were keen to make sure the VCT portfolios were spread across a large number of sectors to lower risk.
The report pays particular attention to the 2012 rule changes. Generally, investors and VCT managers had viewed the changes positively, suggesting that they could potentially broaden the types of companies benefitting from the schemes. It is clear from this report that the UK Government see Venture Capital schemes as having a positive effect on the UK economy and will hopefully continue to support them in the years ahead.
The full report can be downloaded from the HMRC website.