Funding
The post-mortem on Rishi Sunak’s Autumn Budget has focused on the politics of tax and spend, but I have heard very little discussion about an equally important question – where was the support for entrepreneurs?
HMRC’s recently-released annual Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) statistics made for interesting reading. While the 2019/2020 numbers don’t offer a full account of Covid-19’s impact on the market, funding from EIS rose to £1.905bn – up from £1.867bn in 2018/2019 – with SEIS funding marginally down, from £171m in 2018/2019 to £170m in 2019/2020. Combined, EIS and SEIS have now helped over 45,000 startups receive over £25bn in funding. A testament not only to the two schemes, but to the UK’s entrepreneurial spirit.
The COVID-19 pandemic has steered the banking industry worldwide towards digital transformation. Traditional financial services became redundant overnight leading to a historic rise in the adoption of fintech platforms across the world. Cashless payments became more popular due to the need to lead our daily lives in a contactless manner.
Customer Acquisition Cost (CAC) is the cost of acquiring a customer to purchase products. It works along with the Customer Lifetime Value (CLV). CAC is an important term for growth businesses.
Although revenue-based financing has many benefits and in-built flexibility, founders should be assessing its suitability once they considered all the aspects of the product and the lender.
End of last year, I ran a session for founders on raising early-stage investment. At the beginning of the session, I asked the audience to walk me through an outline of the stages involved when engaging an investor. One of the responses I received was, ‘you pitch the business…then if there is interest you present and discuss the financial model.’ I then asked a second question. When do you use ‘storytelling’? Several responses came in via messaging, ‘the pitch’. Which is correct, but it is not the only stage where it is used.
Even with a stand-out business idea, securing the funds to set your plans into motion is one of the biggest hurdles an emerging enterprise will face. Luckily, there are a number of ways in which your startup or SME can gain capital.
At a time when many people around the UK are making career changes and starting new enterprises, aspiring business owners will be looking for the right business loan to get their companies off the ground. Choosing the right loan partner is an important decision, and it’s crucial that people know what to look for before they commit. The important thing to remember is, it’s about much more than just the money.
We don’t often address mental health in male-domintated sectors, despite well-being becoming a more accepted topic in mainstream media. There is a lingering macho stoicism surrounding the conversation about the toll that raising capital can take on business leaders, which is perhaps no wonder in a field where the pursuit of work-life balance is seen as a weakness.
The UK startup is simplifying the world of podcasting and making it more accessible for the storytellers of tomorrow.
The values of tech companies are skyrocketing, and generally outperforming the rest of the market. With plenty of cash looking for a sound home in growing businesses, the time is now for tech companies. So, how can they bag the best investors to back their technology?
At St. James’s Place, we work with a large number of fund managers within the UK venture capital industry, notably in the tax-advantaged space, investing across many different sectors. This provides us with a unique insight into the small business ecosystem.
Early Stage investors can often seem like mythical animals hidden in parts of the city you have little access to. When you do finally catch yourself face to face in a crowded networking event, or on a brief phone call that you’ve been preparing for all week, it can often feel like an uncomfortably one-sided encounter.
One presumption about tech-for-good startups is that they generate less profit than traditional tech companies. This is a myth – they need to take care to prevent the nobility of the cause from getting in the way of their financial ambition, but there is no fundamental conflict between good business and business for good.
When my business partner, Jack, and I started UnderPinned in August 2018, we had countless images of what running a startup would look like. Time has shown that many of them were poorly conceived. Some, downright fanciful. It’s only been two and half years, but it feels like aeons ago now, and I’ve often thought back to that time, wondering what I would tell myself if I could hop into a time-machine and talk to a younger, bright-eyed and bushy-tailed Albert.
As part of the last budget, Chancellor Rishi Sunak announced that the limit for contactless payments is to be increased from £45 to £100. As a large portion of UK businesses have been closed for months, there’s an obvious reason to want to stimulate the economy by making larger purchases easier. While this increase in the contactless limit seems to be a good move on the surface, we must look at the impacts of this change and debate the case for alternative payment methods.
A common question from startup founders looking to bring advisors on board is how to compensate them. What framework can you use to design a suitable package for your advisors?
Whilst the UK is home to a large number of innovative startups, and has even been proclaimed the ‘unicorn’ capital of Europe, it also has a disappointingly high gender funding gap. According to a report commissioned by the British Business Bank, for every £1 of VC investment, less than 1p went to all-female teams and only 10p to mixed-gender teams. The initial reaction may be to point fingers at the VC industry, however interestingly the report also noted that in fact only 5% of all pitchdecks received are from all-female teams.
On April 6th 2021 a new Government loan scheme has come into force to help those businesses with the next steps after they have been affected by the economic difficulties and uncertainties caused by the Covid lockdowns.
Pre-pandemic, the economy was expanding. We’d come out of the global economic crisis wounded but wiser, and looking for change. With startups everywhere and SMEs acknowledged for their serious contribution to the economy, things were pretty good. But no one was prepared for COVID-19.
