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Blackfinch Ventures announces £1.3m Investment Round and Intention to Pay First VCT Dividend
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Blackfinch Ventures announces £1.3m Investment Round and Intention to Pay First VCT Dividend

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January 24, 2024

Anna Wood is the Editor of Startups Magazine. She joined…

This follows the completion of their latest investment round in December 2023, where they invested £1.3 million. Blackfinch Ventures maintains its commitment to investing in a broad spectrum of early-stage tech companies with high potential across the UK. This investment strategy is in harmony with the national objective of fostering technological innovation.

Richard Cook, CEO, says: “I’m incredibly proud of the contribution Blackfinch is making to the UK economy through the investment and support which we provide to our VCT investee companies. Over the years, we have established a strong portfolio of high-growth firms which provide an industry-leading exposure to underlying revenue growth. It is fantastic that our VCT is now able to target dividend payments for 2024 and beyond as this now enables a wider range of investors to consider investing with Blackfinch.”

The significant achievement of the VCT dividend by Blackfinch Ventures is highlighted by data from Wealth Club, an alternative investment platform. This data showcases the outstanding performance of Blackfinch Ventures’ portfolio, notably for its high exposure to rapidly growing companies, leading in annual revenue growth among UK VCTs. This distinction validates Blackfinch Ventures’ proficiency in identifying and nurturing companies on robust growth paths, with 85% of its investments demonstrating an annual revenue increase of 25% or more.

Dr Reuben Wilcock, Head of Ventures at Blackfinch, reflects on their investment philosophy: “Our investment strategy is in step with the UK’s drive to nurture a dynamic early-stage tech ecosystem. We emphasise identifying and supporting early-stage businesses that showcase not only innovative technology but also sustainable and scalable growth, contributing to the UK’s technology sector and economy.”

In the run up to tax year end, Nicholas French, Chief Distribution Officer at Blackfinch, adds: “Understandably, advisers look to track record to find confidence in their recommendations to clients. The announcement of the VCT intention to make its first dividend payment is a game-changer for those seeking income paying VCTs. Not only does the Blackfinch VCT have many award-winning companies in its portfolio, they are also well diversified both geographically and by sector, giving advisers a strong reason to consider them within the holistic review of client investment objectives.”

The latest investment cycle by Blackfinch Ventures includes additional funding for two companies in the existing VCT portfolio, as well as an investment in a new portfolio company, Quin. Founded by a pair of sisters, Quin leverages deep-learning to analyse anonymised website traffic in real-time. This enables the ethical prediction of user behaviours, facilitating the delivery of pertinent, timely experiences that lead to stronger conversions. Quin’s AI system is designed for easy integration without the need for coding expertise, resulting in significant campaign cost reductions and a 30% revenue increase.

Tended, another standout startup in the Blackfinch Spring VCT portfolio and a beneficiary of the recent investment round, focuses on enhancing safety in high-risk sectors such as the rail industry through its wearable devices. The global recognition of Tended’s commitment to safety was cemented when it featured in Time Magazine’s Best Inventions of 2023. Such acknowledgements underscore the impactful technological advancements that Blackfinch Ventures seeks to nurture.

See Also
When global labour market data is released, headlines tend to fixate on a single metric: unemployment. This year is no different. According to the latest figures from the United Nations and the International Labour Organisation, global unemployment remains relatively stable at just under five per cent. At face value, this suggests a labour market that is holding firm despite economic uncertainty, geopolitical instability and technological upheaval. In reality, it masks a serious and underreported problem: the true global jobs crisis is not a lack of work, but the growing scale of informal work. More than 2.1 billion people worldwide are employed in the informal economy, including misclassified workers operating outside effective regulatory coverage, where employment is typically unregistered, contracts are absent or unenforced, and access to labour rights and social protections is limited or non-existent. That represents a large portion of the global workforce. If unemployment reveals how many people cannot find work, informality shows how many are working without protection or long-term opportunity. Informal work is often associated with developing economies or unregulated sectors. However, this form of work is increasingly occurring within developed economies and regulated sectors, hidden within otherwise legitimate, fast-growing small and medium-sized enterprises – and this is often unintentional. For both businesses operating solely in domestic markets and those that have expanded abroad, adopting new workforce models and attempting to respond to rapid technological change, the crisis of informality is emerging in three key areas. The first is worker misclassification. Individuals are engaged as independent contractors but operate in practice like employees – working fulltime, at set hours, for years at a time. This is particularly prevalent in gig and platform-based roles, where algorithms determine pay, hours and performance without considering employment rights. Gig and platform work often presents as flexible and empowering, however, in practice, many platforms exercise employer-like control over payment, performance management, hours, and length of engagement, while explicitly avoiding employer obligations such as tax filings and the provision of statutory benefits like annual leave and healthcare. The result is a growing cohort of workers who fall between legal categories, carrying the risks of self-employment without the autonomy or protections that should accompany this mode of work. The second area is cross-border remote work, where informality can inadvertently arise. With post-COVID remote working models here to stay, companies are directly hiring overseas talent, assuming that because the worker is not based in the company’s home country, local employment laws do not apply. Where employment is not properly registered (whether by the employer and/or employee), local labour law is not applied, or social security obligations are misunderstood or ignored, these arrangements can slip into a form of modern informality, even where the relationship appears to be formal on the surface. This is often the point at which organisations begin to seek external guidance. In many cases, neither party fully understands the legal implications of the arrangement, which leaves both employer and worker exposed. We frequently see organisations approach us when a specific issue surfaces, such as payroll inconsistencies, questions around benefits entitlement, or concerns raised by the workers themselves, including registration process failures. Business leaders should also be aware that permanent establishment risk can arise if a remote employee is deemed to represent the company locally, which can trigger corporate tax obligations. Social security errors can happen when contributions are not made correctly in either jurisdiction, leaving workers without coverage and employers facing backdated liabilities. Meanwhile, employment law conflicts can emerge when contracts fail to meet the requirements of the host country regarding notice periods, benefits or termination rights. The third driver of informality is structural. These arrangements are becoming more common as artificial intelligence and evolving workforce models outpace regulation. Businesses are innovating at speed, but legal frameworks are struggling to keep pace. The UK’s Employment Rights Act offers a clear case study of the direction of travel. Worker protections are expanding, classification rules are tightening and enforcement is becoming more coordinated across agencies. Informal arrangements that once sat in legal grey areas are moving firmly into view and what was previously tolerated is falling under scrutiny. The challenge is that informality is rarely a deliberate choice. For many growing organisations, it becomes the default because compliant pathways are complicated and difficult to navigate alone, particularly across multiple jurisdictions. Legal advice, payroll, tax, HR, and immigration compliance are often siloed, leaving gaps that businesses may not even realise exist until a problem arises. For instance, digital nomad visas are often viewed as providing holders with wholly compliant right to work status, however employers may not realise that this is not always the case and contracts may not reflect the correct legal status or entitlements. Addressing informality requires a change in how we think about employment at a global level and recognising that flexibility and compliance are not mutually exclusive. Businesses need models that allow them to access global talent quickly while ensuring workers are properly employed and protected under local law. As attention remains fixed on unemployment figures, informality continues to expand beneath the surface. It is this hidden cohort of workers, contributing economically without security or rights, that represents the real crisis in the global labour market. Solving it will require coordinated action from policymakers and businesses alike, and a commitment to building workforce models that are not only innovative, but sustainable and fair.
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These investment activities of Blackfinch Ventures align with the Chancellor’s Mansion House reforms, which are designed to strengthen the UK’s technology and science sectors. A pivotal element of these reforms is the £250 million Long-Term Investment for Technology and Science (LIFTS) programme, which is part of a broader strategy to funnel up to £1 billion into UK tech firms from various funding streams.

Dr Wilcock concludes with a broader perspective on the impact of their investments: “Beyond the financial returns, VCTs play an important role in the UK’s economic fabric. They supply vital capital to emerging companies, fuelling not just their growth but also contributing to job creation and wider economic development. Our investments in these early-stage companies are part of our commitment to propelling the UK’s economic potential, promoting a culture of technological advancement and innovation that allows society to thrive.”

2024-01-24

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