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Wood Street Microcap

Elite Rated by FundCalibre

This a highly concentrated, high conviction UK micro-cap fund. It has been managed by Ken Wotton since its launch in 2009, with the support of the 40-strong specialist team at Livingbridge, who have 20 years’ experience investing in this space. The fund only invests in companies in a select number of sectors where they have specific expertise.

Company Description

Livingbridge has been investing in smaller companies since 1995. Many of the investments made are in unquoted companies with values between £5 and £100m. The team’s expertise lies mainly in the UK, although the company also invests in Australia. They are probably best known for running the highly successful range of Baronsmead VCTs.

Factsheet_livingbridge_logo

Fund Manager

Ken Wotton graduated from Oxford and began his career as a chartered accountant at KPMG. He spent 5 years working as a sell-side analyst for Commerzbank before moving to Evolution were he covered small-cap telecoms and technology. Ken joined Livingbridge in 2007 and has been running the Wood Street fund since it launched in 2009.

Factsheet_ken_wotton

The variety and dynamism of genuinely smaller companies always keeps this job interesting. It’s exciting to back entrepreneurs and help them to grow their businesses.

Ken Wotton - Fund Manager

The Investment Process

This is a growth fund that aims to invest in companies which can double their earnings over a five-year period. The manager avoids high risk sectors such as oil, mining and property, and instead focuses on the areas where the team has expertise.

Livingbridge has experience of working with companies and management teams before they come to the stock market and this can give them an advantage over their peers. The fund only invests in profitable businesses with low levels of leverage. Most investments are initially between £50m and £250m but the manager will continue to hold successful investments which have grown beyond this size.

Risk

This fund is unusually concentrated for a smaller companies fund with only 40 holdings. This means the investor is heavily reliant on the fund managers skill in choosing the right investments. The manager mitigates this risk by undertaking rigorous analysis and by only investing in profitable companies with low levels of leverage. The fund is also deliberately small in size at below £50m which gives it the flexibility to exit positions relatively quickly and easily if necessary.

Our Opinion

This fund is run by small-cap specialists who have unrivalled experience and resources in this area of the market. Ken has run the fund since inception and has an exceptionally strong track record. The highly concentrated nature of this fund is unusual for smaller companies, which increases the potential for strong returns but also increases risk.

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