Marcus Love

I couldn’t be prouder to be a Venture Partner at Isomer Capital (aka the best European FoF - at least for me) as we just announced the launch of our pioneering £100m secondaries fund. This fund is dedicated to acquiring stakes from LPs in various VC funds, tapping into a massive and largely unexplored market. 🌟 Key Highlights: - Focused Investment: Primarily targeting stakes in VC funds, with selective investments in private companies. - Robust Funding: Already over 20% funded, thanks to strong support from Nordic family offices and a German foundation. - Market Potential: With a growing number of private tech companies and a VC liquidity crunch, Europe's VC secondaries market is poised for rapid growth. - Track Record: This isn’t Isomer’s first foray into the secondaries market. As a firm we’ve done several secondaries deals with portfolio companies and VC firms, including early-stage VC Seedcamp (in 2021) and mobility giant Bolt (in 2023). - Expert Team: Welcoming the amazing Omolade (Rachel) A., formerly of Coller Capital, as a principal to lead this initiative. 💡 Investment Strategy: - 65-75% of the fund will buy "LP interest" stakes in VC funds. - 15-25% will be directed towards stakes in companies. - Up to 15% reserved for flexible investment opportunities. 📈 Looking Ahead: We're targeting returns of 2-3x, with significant distributions expected in the next 4-7 years. As one of the few players in this space, we're not just participating in the market—we're driving it forward. Read all about it here: https://lnkd.in/dc7sbC3G #VentureCapital #SecondariesFund #EuropeanVC

23

1 Comment

🔥 VNXD Private Equity 🔥 If I had a pound for every time someone suggested this (included many of the M&A Advisers we deal with), I'd have.... a lot of pounds! But seriously, in the last 5 years, we've amassed 20,000+ board advisers, many of whom have built and exited their own companies. Nearly 5,000 members have also indicated they're open to investing in companies, whether actively as Board Advisers or passively, if the right opportunity arises. So.... We’ve got 20,000+ highly connected members, advising tens of thousands of boardrooms, with over 80% of our members telling us they were appointed specifically to help with strategic and exit planning strategies. Hmm... And let's talk about the level of funds – those indicated investment sums are now in excess of £450,000,000. Imagine if we decided to do something.... The potential impact is enormous. We could drive significant strategic growth, create more successful exits, and provide substantial investment opportunities. The possibilities are truly limitless. 🚀💼 But that's not in our plans and we are not a regulated vehicle so this post, as they say, is pure parody. Or is it? 😜 #StrategicGrowth #BoardAdvisers #InvestmentOpportunity #BusinessPotential #NextLevel #InnovateToGrow #ecosystem

28

3 Comments

Taavet Hinrikus and I made the Financial Times Due Diligence email. https://lnkd.in/ez2AuGQx One 'unintended consequence' is that if there is a 45% tax on carry and CGT (raising £40m per year, remember) it for all intents and purposes closes the door on new VCs in the UK. Especially started by teams from non-traditional backgrounds. To meet the GP commit, you need to be already part of the 'wealthy' as you cannot rely on the value you create - nearly half of it will disappear - to fund it. We have both had extremely successful startups which are few and far between. The smaller number of new VCs will therefore more likely increasingly be for people who have inherited the capital or can draw it from their already rich family. Probably not want they have in mind with this policy.

32

2 Comments

Useful and timely analysis Overall: could have been worse

14

💼 Top 10 UK Venture Capital Firms by Deal Count - Plus the Power of NEDs 💼 The UK's venture capital firms are leading the charge in backing high-growth companies, but think abut this..... if each deal also added a non-executive director (and they invariably do) to bring experienced governance and strategy into play, let’s look at the numbers: Let's start with the top 10 most active VCs in the UK in 2024, and the potential impact: 1. SFC Capital - 99 deals   2. Access EIS - 65 deals   3. Octopus Ventures - 54 deals   4. BGF Growth Capital - 47 deals   5. Ascension - 34 deals   6. Fuel Ventures 🚀 Ventures - 31 deals   7. Seedcamp - 28 deals   8. LocalGlobe - 26 deals   9. Par Equity - 25 deals   10. Amadeus Capital Partners - 24 deals If each deal added a NED, and each fund paid an average recruitment fee of £25,000 per hire, the total cost across these deals would be: 😳 SFC Capital: £2.475m   😳 Access EIS: £1.625m   😳 Octopus Ventures: £1.35m   😳 BGF Growth Capital: £1.175m   😳 Ascension: £850k   😳 Fuel Ventures: £775k   😳 Seedcamp: £700k   😳 LocalGlobe: £650k   😳 Par Equity: £625k   😳 Amadeus Capital Partners: £600k  👉 Total cost: £10.825 million 💸 Ps. Many recruitment fees are in excess of double the "average" fee of £25k. At Virtualnonexecs.com, we work with VCs to flatten the cost of recruitment across their portfolios. The VNXD Operator Network is available on a flat annual subscription - for less than the cost of a single hire. You get access to 22,000 non-executive directors, supported by internal headhunters and there's no "per hire" fee. This means ongoing access to the best talent with no extra costs for every deal. If you are interested in accessing this level of support, let’s discuss. You can book a demo with me here: https://lnkd.in/d3na7CEC or simply drop me a DM. 👉 #VentureCapital #Startups #NEDs #Leadership #BusinessGrowth #Investment #UKTech

11

"Funding Collapse sends investment in start-ups to six year low" The Times today covering the shocking stats that VenturePath uncovered, with our partner Beauhurst. Great quotes from supporters Michael Moore CEO, BVCA and Julian David CEO, techUK. * UK VC funding at Series A is -44% from last year, and worsening * Q3 24 is down a staggering 57% from Q2, itself down from Q1 * 9 in 10 seed funded startups cannot access Series A VC funding, the next 'rung on the funding ladder' * Just 32 future scaleup companies across the whole of the UK were able to access their first VC funding round in Q3...a 6 year low * Half a billion less capital is going in to UK scaleups at Series A, than just 2 years ago! As the UK scaleup funding gap widens, we are losing ground against other countries, at both startup stage (a position the UK worked hard to achieve, since 2011), and for scaleup support. OECD data: 13th in the world for scaleup support, and that's before Series A funding access dried up. I get that its confusing. Another report (BBB, Nations & Regions) released this week spoke of positive trends in private investment, stating "The data for Q2 2024 shows that investment value has continued to grow". Great, I love to see optimistic data. But under analysis that bundles venture with private equity (later stage), where a few megadeals skew the numbers. Otherwise the exact opposite is true. Our independent research here, for the UK ScaleUp Investment Mission, is laser beam focussed on Series A. The funding round where companies move from the c.1m startups launched each year, through the 2,179 that access seed funding, into the rarefied category of being recognised as future scaleups, attracting Series A funding (£2-10m). The UK venture landscape is currently funding just 248 pa of these companies, and declining. We've been sharing this urgent call for support with the new Government since the day after the election. I've personally met with several Ministers, and spoke to all the relevant Government departments. I will shamelessly repeat loudly what is at stake. UK scaleup funding at Series A has nearly halved in a year, and continues to decline steeply, more than halving in the last quarter. VenturePath developed The UK ScaleUp Investment Mission to convene the scaleup support ecosystem and £7bn of funders to help address this problem, to improve nationwide access to VC investment, and create more venture-backed successes. We have clear support, clear recommendations to reverse this decline in UK scaleup investment, and have made a clear ask of Government for participation in this, to ensure immediate action is taken to create the conditions for success for UK scaleups, ensuring the focus on growth isn't undermined by lack of capital, or equitable access to it. Government decision makers, we'd love your interest, to progress to action. HM Treasury: Rt Hon Rachel Reeves Spencer Livermore James Murray & CC Poppy Gustafsson (welcome to the debate).

738

195 Comments

Pension funds enjoy a very material tax exemption privilege. I wonder if some element of that privilege should be linked to commitment to the sector, increased over time to stop a wall of money, where for example a vehicle like Adam proposes and/or direct investment would qualify. Pension funds free not to participate, might have a size threshold, but if they do not they pay some tax. Link that to whatever regulatory tweaks needed to ensure funds are not penalized for investing a portion in growth - rationally 4% has to be a perverse allocation, someone has got the rules wrong. It feels like it is not in their investors' interests, aside from the societal point of the need to support growth, the no.1 claimed objective of the incoming government.

7

1 Comment

There’s a big difference between bootstrapping and self-funding. In my view, bootstrapping is about being a scrappy start up that claws its way to some early revenues, to then fund product development. It might be a bit of consultancy work or project work to bring some early cash in, it could be selling a super early version of an MVP, it might also be accessing some grant capital. For businesses that are bootstrapping it also creates a great cost discipline. Whilst it’s not easy to do, there are limited barriers to entry. As an ecosystem, I think we should always promote bootstrapping, even for businesses that go on to raise it provides a great mentality to maximise the ROI on every £1. Self-funding is very different. Self-funding is when an individual or individuals have sufficient capital to invest £X00k to dive straight into product development. Whilst that’s a great strategy for the very few that can afford it, it is not something that should be expected of any founder. That’s how becoming a founder ends up an elitist game. For me: Encouraging bootstrapping ✅ Expecting self-funding ❎❎❎ _____________________________________ 💭 Agree? Disagree? Let me know in the comments. 🔔 Like my content and want to see more? Follow or connect Kiran Mehta. ♻ Found this post useful and think your network will to? Please hit that repost button. #vc #venturecapital #founders #founderstories #raisingequity 

32

11 Comments

"Britain also suffers from a dearth of 'true risk capital and there’s not a lot of managers who are comfortable taking the risk that is required to manage that capital. In the City of London there’s a lot of capital but it tends to be focused on low risk, low reward asset classes like gilts.'" And most of the rest of Europe is even more risk averse when it comes to investing. Value created by European innovation, technology, and entrepreneurship routinely flows out of Europe. The hard reality is that Europe is simply an extension of US capital and financial markets. European countries should lean into it and finally structure their systems accordingly. “Private equity has been the biggest driver of returns for our portfolio. I don’t think there’s extra risk — what you do give up is liquidity. Private markets work well when you have pooled assets with a long-term time horizon.” - John Graham European investors should take note. 📝 https://lnkd.in/eaDYkjig

184

33 Comments

Incredible to see Mosaic in the Financial Times this morning in this excellent piece by Sujeet Indap on tech innovation in private equity. Sujeet's research into the historical evolution of Wall Street's analytical horsepower was particularly fascinating. Though I wasn't around for the shift from pen-and-paper to VisiCalc, I can only imagine the step-function productivity increase it unlocked. Anders' assertion that the advent of the spreadsheet in part drove the LBO boom of the late '80s is also intriguing (although I'm sure the <10% min. equity helped, too). Though the spreadsheet was a great advancement in the '80s, it always baffled me that ~30 years later (when I began my PE career) we were still underwriting billion-dollar buyouts using a generic productivity tool and not an industry-focused application. That's precisely why I started Mosaic. With dedicated platforms like Mosaic and Blackstone's Atlas now powering new deal underwriting - could the industry benefit from a similar step-function productivity increase? Also - an open question to anyone who was working as an investment professional in the 1980s/1990s: was the spreadsheet initially met with hesitation / skepticism by a subset of old-school investors who thought there was value in grinding it out until 3am with only pencil and abacus in hand? We're fortunate at Mosaic to work with some of the world's most forward-thinking investors who readily embrace change - but this sentiment does comes up once in a while. What happens to the holdouts? And curious how the innovators - whose shoulders we stand on - navigated it before us. Read the full story here: https://on.ft.com/4dXEvth

122

8 Comments

🚀 Big News for UK #Startups: EIS & VCT Extended to 2035! In a huge win for entrepreneurs and investors, the UK government has extended the Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) scheme until April 2035! These tax-relief schemes have fueled £41 billion in investment over the last 30 years and are now set to provide another decade of support for early-stage businesses. 🙌 With 30% upfront income tax relief and capital gains exemptions, these schemes encourage investment in high-risk, high-reward #startups, driving #innovation, job creation, and economic growth across the UK. #Startups and investors alike now have long-term stability to continue scaling new ventures. 📈✨ Industry leaders are applauding this move. Michael Moore from the British Private Equity & Venture Capital Association (BVCA) called it "a vital step" to maintaining the UK’s competitive edge as the third largest #venturecapital market in the world. Extending these schemes ensures that more capital flows into the UK’s most exciting early-stage companies. This is a major boost for the UK’s startup ecosystem and a clear signal that the government is backing #innovation and #entrepreneurship for the long haul. 🌍💡 ETA Technologies is celebrating the good news and is dedicated to leveraging our cutting-edge technology to assist investors in identifying the most promising founding teams for investment. In the early stages, it is truer than ever: investors invest in people... What impact do you think this will have on the UK’s startup landscape? Source: https://lnkd.in/dUaFND_p

19

1 Comment

TLDR: EIS should be scrapped as a fund structure but retained for Angel investments by individuals. Alex Chalmers has done all the work which in 10 years I've never got around to doing: why 95% of EIS/VCT funds are bad for our tech ecosystem, rip #startups off, and why as a Founder you should push back against their stupid fees or not take their money. https://lnkd.in/dnq9ZScS

35

7 Comments

📣 We’ve got a big ESG_VC event planned for Tuesday next week – featuring the latest updates to our measurement framework, news of our 2025 benchmarking with the British Private Equity & Venture Capital Association (BVCA), and an introduction to our new platform partners… 📣 On the afternoon of Tuesday 26 November, we’ll be gathering 200+ VCs for the latest update on the ESG_VC Measurement Framework – from what it covers to how it informs industry-leading research, and how you can now work with our accredited data collection partners. This will be our first event delivered in partnership with our cohort of platform partners: Apiday, Novata, and PortF. I’m excited to share with our members how these partners can support a big step up in your ESG initiatives. Join us for a jam-packed event that will feature: 🟢 An update from Suzi Gillespie of the BVCA on how you can take part in our 2025 research – we analysed ESG performance in c.600 VC-backed companies in 2024 and we’re looking to deliver an even more ambitious piece of research next year… 🟢 Insights from Emily Havers of Fidelity International Strategic Ventures on the updates that have been made to the framework and what it means for our members, their portfolio companies, and the broader ecosystem. 🟢 Perspectives from Emily Matthews of Oxford Science Enterprises and Nina Foote of Volution on how the ESG_VC Measurement Framework has supported their work on ESG. 🟢 Presentations from our platform partners: Edouard Audi of Apiday, Conor O'Laoire’Laoire of Novata, and Alex Lu of PortF. It’s going to be a good one so do register. Link to sign up in the comments! #ESG_VC #sustainability #venturecapital

47

1 Comment

🚨 How will the UK’s new #Budget impact founders and investors? 🚨 Today’s Budget brought changes affecting founders and investors, particularly a hike in Capital Gains Tax (CGT) from 20% to 24% (effective tomorrow) and changes to BADR (rising from 10% today to 14% on 6 April 2025 and 18% from 6 April 2026-27). Tax efficiency has never been more important for founders. That’s why we’re thrilled to highlight our SEIS for Founders service! This is an invaluable opportunity for founders to save potentially millions in CGT at exit, as well as a number of additional tax benefits as detailed below. 👉 Learn if you qualify for SEIS for Founders: https://lnkd.in/e4bqFdbu #TaxEfficiency #SEIS #StartupGrowth

158

63 Comments

How do you drive value when fundraising? In the absence of a clear guide, many founders and their boards will chart a steady and linear progression in value, supported by revenue or profit growth, starting at the implied valuation of the initial investment and heading towards a target valuation with valuation reference points to validate this approach. In determining the target value it is worth remembering that business values for scaling growing businesses are typically derived by considering three different methodologies - find out more in this article. https://lnkd.in/e4CH-HH7 #fundraising #valuecreation #investments

3

Well done to Alex Chalmers for publishing a really well researched look at EIS/VCT funds. These themes have been bothering a lot of us for years: the fees, the mediocre performance, the misalignment of incentives. I thought I'd add some broader context. 👉 EIS funds :: like everything in VC, it's about the manager. There are some EIS funds that I'd choose to work with over GP/LP funds. I think Fuel Ventures 🚀 (🚀 Mark Pearson, Oli Hammond) are great, real energy and value. Same with MMC Ventures - a firm thesis and very professional approach. These are 2 great examples of funds with an identity & direction. They act like VCs, not 'fund managers'. Generalist funds are difficult to operate in any model, tax efficient or otherwise - it's hard for founders to get value add beyond capital when their investors don't have the specific expertise in a sector or model. The EIS/VCT industry has always been heavy on fees, but 'deal' & 'board' fees have also been common with GP/LPs too for a long time. That doesn't make it good practice, but it's not unique to EIS funds. One of the good things about EIS funds are the access they give to retail investors to a portfolio of tech companies - and that's been incredible for the industry over the last decade. The downside is that some fund managers are clueless, at best, malicious at worst. I've seen atrocious terms from EIS funds (5% exit warrant on entire share capital of a business + mega fees + participating prefs) - but that's a case of buyer beware - and maybe more of a stand from the BVCA. (BTW, the funds that take this approach have the worst fund performance.) It's easy to look at EIS funds after years of LPs backing new funds galore, but don't forget that these operators have been around for years, some (inc. Oxford Technology Management) were pioneer investors for a long time before 'deeptech' became fashionable again. 👉 When it comes to VCT, there's a context. The 'VC' bit has been a misnomer for the past 20 years. VCTs were launched in 1995 when venture capital looked completely different. Before 2015, managers could invest in MBOs through the scheme, for businesses of any age - it was the more edgy end of private equity, but nowhere near what we now consider as VC. A few classic PE managers like NVM & LivingBridge moved of the market, but for those who have stayed, the PE culture often remains and VC as we know it is sometimes an anathema. My own experience of VCTs has been largely poor. £100k+ in external DD, general misunderstanding of the venture model and finicky compliance with VCT rules that can hamper a company's flexibility. Since 2017, money has poured into VCTs via IFAs. I've wondered if the retail investors understand the industry, or even care. But again, as always, it's buyer beware. TLDR; EIS funds just need to shape up. VCTs need some innovation. WDYT? -- 📍 I advise scale-ups on fundraising M&A and often help their investors, too. 🤝 📧 [email protected]

8

4 Comments

You asked, We Delivered ❗❗ There's ways to do & ways not to do pitch decks. Bizvest UK do it the right way. ✅ Our pitch decks are done by experienced investment professionals, delivering decks that investors actually want to see. Who knows what investors look for more than investors themselves ❓ Want to learn more? Drop me a DM 📩 #investors #pitch #pitchdeck #investment

8

Chancellors come; chancellors go. Pension consolidation ‘consultations’ and ‘visions’ outlast them all. Action please! LGPS: Superpool 100% - and follow the lead we set a decade ago at London Pension Fund Authority: invest into private markets and equities. Funding doubled in 7 years. TPR/DWP: sort out the Pension SuperFund framework to give certainty. And ‘pensions not pots’ with Pension SuperHaven

23

5 Comments

I stayed a bit later at work today to send out the fund's monthly newsletter so I got to buy food at Don Don Donki at a discount. I think the discount starts at 20% at 830pm and increases every half an hour or so. Or maybe it's arbitrary to prevent customers from timing just like what happened to the index rebalancing strategy. Anyway, I got the Yakiniku lamb rice bowl at 40% off. From my extensive OT experience you should only get cooked food, no sushi or sashimi, beyond 20% discount. The meat tasted OK, the rice a bit soggy, but the egg was pretty much cooked. Since I have an Asian studies major with a Japan specialisation*, I know the egg was supposed to be runny to spread across the meat but the bowl has been left under the heated lamp for too long. Over the past few trading days, it seems that all people could talk about was Nvidia, whether the AI trade has been overbought, whether the PE should be 45x or 70x, whether it's just profit taking. So there's risk to the downside and some possibility of the stock going up even more. Sounds like an OK trade but is this the BEST stock that portfolio managers can pick? Why do people STILL pick Nvidia then? Just like the 40% discount on my yakiniku-don, you save on the 2 & 20 you otherwise would have to pay a tech hedge fund which would probably also have Nvidia as one of their biggest positions if the fund is doing well. I even know Asia hedge funds in Nvidia because somehow it can count as a China story. Yeah, the 'meat' of the AI global story is still intact. Maybe it's a little late to get those multi-bagger returns but well it's an OK, even pretty solid stock pick that no one's gonna fire you for. Given a choice I would much rather have a nice hot steaming bowl of Yakiniku with runny egg. But that's because I enjoy good food and flew all the way to Copenhagen to eat at Noma and already snagged a seat at Disfrutar in Barcelona, this year's world's best restaurant. Now you know why I have to keep making money by delivering returns as a hedge fund manager. Gotta keep up with food inflation. Find out what strategies we see that will thrive in a high inflation environment and/or if Trump wins the election: www.gao-cap.com *I also have a dual degree in finance because my mom threatened to stop paying my school fees if I didn't graduate with a practical major. And it was the same school fees whether you have two degrees or one, so it's better value to have more. The Math minor was free too. Remember I coined the term 'Asian Math' here first. #hedgefund #inflation #japan #Asianmath #valueinvesting

62