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Why recessions can create opportunities for new companies with big growth plans

Octopus Ventures has invested in and supported early-stage companies since 2008, and has backed some notable success stories – the likes of Zoopla, Depop, and Many Pets. And they’ve backed businesses through harsh global economic conditions before.

What might surprise you is that, as the outlook for the economy looks challenging, the team believe that now could be the best time to build a new tech-enabled business in over a decade, and therefore the best time to invest in these companies.

We interviewed fund manager, Malcolm Ferguson, to ask him about the opportunities the current economy could provide for new businesses that are hungry for growth.

Before watching the video, it’s important understand that venture capital is a high-risk area of investing.

The value of an investment, and any income from it, can fall as well as rise, and investors may lose all their invested capital. VCT and smaller company shares could fall or rise in value more than other shares listed on the main market of the London Stock Exchange. They may also be harder to sell. Tax reliefs depend on VCTs maintaining their qualifying status or portfolio companies maintaining their EIS-qualifying status. Tax treatment depends on individual circumstances and could change in the future. VCTs and EIS investments aren’t suitable for everyone. We recommend seeking financial advice before making any investment decision.