The FSE Group and Social Finance have launched Social Impact VCT plc to raise up to £20 million of onward investment in social enterprises and socially-motivated businesses. It is the first diversified, professionally managed, fully listed social investment product available for UK retail investors.
Social Impact VCT will be jointly managed by the FSE Group (“FSE”) via its FSA-authorised subsidiary, FSE Fund Managers Ltd, and Company . Both FSE and Social Finance are not for profit organisations working to develop the impact investment market in the UK. FSE Fund Managers Ltd will act as the fund manager and Company will act as the investment adviser and focus on deal origination and social impact monitoring. John Gregory, an established figure in the alternative investment world, will be chairing an independent nonexecutive board to oversee the investment vehicle.
Social Impact VCT is the first investment vehicle that allows retail investors to invest in businesses that put social impact at the heart of their mission. Its investment policy is to invest in social enterprises and socially-motivated companies that engage with people who are marginalised, vulnerable or disadvantaged, work in local communities to support cohesion, promote socially motivated brands and improve health and education provision. Social Impact VCT will invest the majority of its funds in established socially-driven companies looking to expand their geographic or product reach and/or whose revenues are underpinned wholly or partially by confirmed delivery contracts.
Social Impact VCT is an 8-year planned exit, specialist VCT investing by way of secured or unsecured debt and equity. Given the tax advantages available to subscribers for VCT shares, an eligible individual subscribing for £2000 will generate an immediate £600 (30%) income tax relief on the initial investment. In addition, any dividends and/or capital gains are free of tax.