44 . Glasgow Business January/February 2013


professional advisers and other portfolio companies. VCs are oſten quite ‘exit’


focused, in that fund managers will look for companies with a clear vision for rapid growth, followed by flotation or trade sale. In this sense, venture funding is not right for all businesses or business owners and it is important to know what you want.


Crowd funding


A relatively new concept, crowd funding has grown quickly in popularity, particularly in the US. Te premise is seductively


WEBSITES CROWD


FUNDING


www.kickstarter.com www.bloomvc.com


community’s trade body, is also a useful resource and well worth a call.


Venture capital


Venture capital (VC) funds make equity investments in early-stage companies which show high growth potential, but typically are also high risk. VC funds also prize


innovation and uniqueness, either in a company’s business plan or the product or service they offer. Consequently, many VC deals take place in the technology or life science sectors. Te amount invested by funds


varies considerably, but will usually take place aſter the seed funding, aſter angels have become involved, during the development and growth funding rounds. Te routes to meeting VCs


are very similar to angel syndicates; network events,


simple: A start-up business with a great idea posts its proposition onto a publicly accessible website, where individuals contribute small amounts of funding, in exchange for either equity or (more commonly) an item related to the


product itself. Te items offered


in exchange are typically tiered by value, ranging from a discounted


pre-order for the product itself, to more exotic items (a crowd- funded feature film, for example, may offer cameo roles for large donors). Te American site Kickstarter


is probably the best known crowd funding provider, though a number of UK- based companies are offering similar services. One such site is Bloom


Venture Catalyst, where Michelle Rodger is chief communications officer. “Crowd funding has all sorts


of benefits in the overall funding mix,” said Rodger. “Most obviously, you have an instant customer base and the ability to generate revenue from that affinity from day one. “Secondly, if you can get


momentum behind a crowd- funded project, that’s a very powerful thing to take to a bank or investor for additional funding.”


“Venture funding is not right for all businesses or business owners and it is important to know what you want”


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60