True raises £25m fund for bombed-out retail and consumer firms

True, the investment firm that owns the Cotswold Company and Zwift, the online fitness platform for cyclists and runners, has raised a new fund to take stakes in “bombed-out” listed retail and consumer companies.

The fund, which has raised £25 million from founder investors, plans to target small and medium-sized retail, consumer and consumer-related technology companies, shares in which have been particularly poor performers in recent years.

Matt Truman, co-founder of True, hopes the new fund can bring the benefits of the knowledge they have in the private markets to the public markets.

The fund will be a “positive activist” — working with management teams and providing access to True’s network of companies — rather than agitating for change or pressurising management teams. True intends to hold stakes in the companies for the medium to long term.

Alongside its venture capital and private equity divisions, which run a handful of funds, True has an innovation and strategy division that works with start-ups to industry leaders to accelerate their growth using cutting-edge technologies.

The division also works with big retail and consumer companies, including Marks & Spencer, Warner Bros Discovery and ABF, on strategy and innovation programmes linking them with fast-growing and industry-leading companies and technologies.

The founding investors in the new fund include a number of UK and European retail entrepreneurs, former FTSE 100 chief executives and a number of big retail investors. The fund will open to qualified professional investors next month.

The new fund is planning to take “influential, material, long-term positions” in up to a dozen companies. “Experience whilst building True has taught us that when the crowds run away it is often a time to re-examine.”

Truman, a former investment banker, believes that a dwindling number of sell-side analysts and the combined sell-off of small and medium-sized companies and retail and consumer companies have led to “market dislocation”.

“The current market conditions make the public equities market, particularly across consumer, retail and related technology look particularly attractive for the long term,” he said.

“True’s unique position, with deep networks across the retail and consumer ecosystem from start-ups through to global enterprises, provides a differentiated perspective on the opportunities which are out there,” he added.