London-based specialist media investment and advisory business Ingenious has launched its second music venture capital trust to invest in recording artists. The initiative, Ingenious Music VCT 2, is targeting to raise £30 million ($52 million) and has already reached its £2 million ($3.5 million) minimum threshold within the first two weeks, the company said in a statement.
This offering follows the launch last year of Ingenious Music VCT, which announced yesterday (Jan. 17) its first investment of £300,000 ($528,000) from the fund for the new band, the Heights. In structuring the deal, Ingenious formed a joint venture — the Heights Recording Ltd. — with Channelfly Group, which will create new copyrights and license recording, marketing and distribution rights for the band.
The deal gives Channelfly the ability to access funding for all recording, artist, video, tour support and marketing costs incurred on the Heights. Ingenious reports that this is the first of what may form a number of similar deals with Channelfly using the Ingenious Music business model.
Ingenious Music VCT raised just over £15 million ($26 million), reportedly making it the largest specialist fund of its type listed on the London Stock Exchange. With the launch of VCT 2, Ingenious claims to be the largest source of independent A&R investment in the United Kingdom with a potential £45 million ($79 million) under management.
Ingenious chairman Patrick McKenna says, “Ingenious Music is very much in line with the government’s agenda of developing the U.K.’s creative industries. With the 40% tax relief for VCTs we have managed to deliver fiscal policy directly to the heart of the DCMS’s cultural objectives for the UK, namely risk investment into new talent.”
Ingenious commercial director Duncan Reid adds, “This is good news for the British music industry, and we have seen strong demand from it. This demand has been driven by the unique opportunity for record companies to share capital risk in the development of both new and established talent whilst providing a welcome boost to tightening A&R budgets.
