The Calculus VCT invests in a mixture of young technology, healthcare and media companies. Gradually, it has been increasing the proportion invested over the past few years, despite the additional fundraising in the same period. This is likely to have helped improve performance in the past three years. Calculus, itself, is one of the longest-standing managers in the space, with a stable, experienced team.

Why invest

Positives

• Strategy: To invest in a portfolio of more established, unquoted companies in order to preserve capital value while generating an income stream.

Positives Issues

• Exposure level: With the majority of the VCT being funds raised in the past couple of years, 75% of the assets are currently invested.

Fund manager

Positives

• Team: One of the longest-standing managers in the VCT/EIS area, Calculus has a highly experienced and stable team.

Issues

• Past performance: Recent VCT performance is good, but longer- term record affected by cash drag and small scale.

Nuts & bolts

• Offer: To raise £10m, with a £10m over-allotment facility in the 2024/25 and 2025/26 tax years.
• Dividend: Target of 5% of NAV from FY’25.
• Buybacks: At no more than a 5% discount to NAV, with 3.8% of shares repurchased in FY’24.

Fees

• Fees: A mixture of direct fees and those charged to the investee companies.
• Performance fee: Changed in 2024 to 10% of excess realised gains since the inception of the VCT.

Risks

• Target returns: The aim is to diversify by sector, and the focus on relatively more established companies should also help mitigate some of the risk.
• Companies: Overall, the strategy is medium risk relative to other EIS/VCT products, with the target company IRR of 20% and capital return of 2x towards the top end of what we would expect for that risk category. The VCT now targets an annual dividend of 5% of NAV, while also providing capital growth.