roundtable


for us, as domestic US companies tend to favour ‘localism’, plus it has helped us with administrative issues such as visas. So, we don’t see any slowdown happening just yet, although politically, in the run-up to Christmas, the US elections managed to divide and unsettle our team more than any financial disruptions.”


Is there a level playing field for exporters?


Staying with the US, Murray enquired whether anybody was particularly concerned with the issue of protectionism post-Trump?


Shub Naha, business development director, Redwood Technologies, explained that they had big expansion plans in the US so were not overly concerned, pointing out that “the US customer looks for what product can do for them as opposed to its country of origin”.


Murray then raised the issue of whether banks were in fact the biggest inhibitor to export growth?


Reed’s view was that it was not an issue for his group, citing the importance of UKTI, who had “been brilliant in introducing us to people who know the local market place”. However, Alan Poole, partner, James Cowper Kreston, argued that banks were not best-placed to back the UK’s biggest export, that of services, which are “hard to debt finance due to the absence of tangible assets as collateral to borrow against”.


The table did agree that some funders were demonstrating more initiative, with Murray highlighting one bank lending initiative in particular where funding was based on Intellectual Property ‘IP’ assets. However, Poole ventured that this was “about 20 years too late; the Reading economy has been built upon IP growth, yet it is only now that lenders are able to innovate the product set”.


Paul Williams, Thames Valley, NatWest pointed out that a number of banks have been contracting back to domestic markets, so it would become more common to end up working with smaller local partner banks across countries rather than just one huge international bank.


Sykes countered that the banks had not been very helpful to date, having become increasingly risk averse in the wake of recent legislation, and agreed with Poole’s point that IP services do not lend themselves easily to bank valuations where the PE model is not applicable since, “we don’t produce widgets and possess repeatable revenue”.


However, Sykes did stress that alternative sources of finance were still available, with “invoice financing having helped us massively with our cashflow ... plus we are now able to look internationally for


investment; for example, a fellow CEO went to China to raise investment for his VR business based in Hampshire”.


Joe Jeffers, finance director, Taylor Made Computer Solutions, expanded upon this point regarding alternative financing opportunities: “There are a lot of alternative investment vehicles typically backed by private individuals out there who are interested in providing finance. This is due to significant capital in the market looking for higher returns given low interest rates.”


Dan Rogers, director, Thames Valley, Hays, pointed out that funding issues would become far more apparent in the lead- up to Brexit, given that “about 30% of all academic research is EU-funded ... there is a big hole coming which will have to be backfilled, so for any organisation reliant upon new technology, there will be a knock-on effect”. Magal added that he had already come across significant EU funding cuts in healthcare, “where the institution in question wasn’t even aware that it was part- EU funded in the first place”.


Government support has been lacking


Staying with the theme of government funding, Murray questioned whether the table thought that Local Enterprise Partnerships and Chambers’ of Commerce were doing a good enough job at present?


Reed was scathing about LEPs: “I can’t stand them because they are so political, at least half-full of local government bureaucrats with no business experience whatsoever ... they’re just not practical, a complete disaster.” He went on to explain that this was one of the reasons why he founded Bucks Business First, because the county was not seen as needing help and hence wasn’t even given the chance to obtain central funding.


Sykes agreed that LEPs had not been efficient to date, pointing out that “the Thames Valley LEP was dominated by debates about the fourth runway at Heathrow or HS2 – there was never any discussion or action about domestic business expansion”.


Regarding the general prospects for the Thames Valley Region, Shields highlighted the general optimism on a three-to-five- year horizon, acknowledged the work done by Chambers, LEPs and the DIT and stated that: “The more we can work with local corporates to shout about why they’ve invested in the area to draw more companies to the region, the better.”


On a similarly upbeat note, Bloxham also stuck up for the Chambers of Commerce, who, he said, “generally did a good job in constructing and facilitating local networks”.


Continued overleaf ... THE BUSINESS MAGAZINE – THAMES VALLEY – APRIL 2017 businessmag.co.uk 35 Rob Pickering David Bloxham


Joe Jeffers


Jon Atherton


Shub Naha


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