roundtable ... continued from previous page


Elliott cited how JLR had successfully used VitalSix as a knowledgeable facilitator to ’filter out’ appropriate small software businesses to help with specific automotive projects.


David Griffiths


Lomer mentioned ‘open innovation’ which has evolved because “markets are moving so fast that large companies with their cumbersome inhouse procedures can’t develop new products in time,” hence their involvement with small, innovative and agile businesses.


Magal: “They (corporates) don’t know what they want, because they only know what they know.”


This reaching-down approach was very helpful, Lomer added, because “an SME trying to talk to a large corporate can take forever.”


... or get your IP valued Jonathan Hughes


Griffiths highlighted funding initiatives involving loans based on the valuation of a company’s intellectual property (IP). “They effectively buy your IP with the loan and at the end of a five-year term of loan repayments you get it back – a great scheme for companies that back themselves for growth.”


Elliott: “Valuing IP on the balance sheet is critical for smaller businesses that don’t have capital assets.”


Robert Lamden


“Especially in a knowledge economy like the Thames Valley,” added Lomer. The IP asset value of hi-tech digital businesses is too often “perceived as a big fat zero, which is ridiculous.”


Hughes: “I think it’s an area the asset-based lending market will be pulled to, rather than be driving towards.”


White explained that IP valuation has a ‘tipping point’ – revealed by a growing enthusiastic customer-base for the IP- created product or service – when the risk- reward funding decision becomes simpler.


Adrian Braine


Caswell: “That tipping point creates the business plan that investors are excited to participate in.”


Only got a short-term funding appetite?


Milne concurred with David Murray that the Thames Valley appetite for funding was largely short-term, perhaps for M&A or business exit reasons.


This three to five-year short-termism was a mindset that radically influenced business plans and the type of funding needed, noted Elliott.


Griffiths suggested many young business graduates are focusing on business planning, trying to win finance and exit


54 businessmag.co.uk


after five years rather than focus on the customer and simply grow a viable sustainable business first.


Funders too may be seeking an exit, noted Elliott.


Snodgrass highlighted that the BGF has a balance sheet rather than being a typical fund so is able to support longer-term investments. “We are not tied to three-to- five-year funding cycles.”


Caswell said LDC also had many long- standing investment partnerships. “We are very happy to think beyond a three-to-five- year mentality. It’s helpful to consider the journey your business might make and have some funding framework to help achieve it.”


Lamden’s profitable company had already hit his target exit figure, but he now intends to continue developing the business, and recently gained a bank loan at a favourable interest rate on three times the sum he originally requested.


Magal noted that funder investment is often long-term in Germany and many German corporates boast ownership stability and proven management teams.


Are people aware of the options?


Doyle: “I had a bank overdraft, but anything over £10,000 needed a personal guarantee, which I couldn’t give. I had no idea that all these other funds were out there.”


Elliott said the investment community needed to ‘open up’ to help businesses achieve suitable funding options within their lifecycles through the different phases of their business lifecycles.


Acknowledging the myriad funding options today, Hughes accepted that some markets had become polarised to product lines or business sectors. “We have no ‘clearing house’ as such to help people filter and understand where to go. That would be helpful.”


The CF world did tend to be structured to service mid-large companies and major financial backers, admitted Milne, but good businesses should always be able to source growth funding.


“What’s missing for a whole swathe of smaller businesses who have the capacity to grow is that funding and advisory structure to tap into, access to people who can guide them through the maze of options, picking the right ones at the right time to help them to their next phase.


“Companies may be experts in their own business fields but they are not financiers,” said Milne, adding that Spectrum CF never pre-judges a client’s funding needs.


Doyle: “I don’t understand the world of corporate finance, but I know how to get and keep a client. If I’d had more capital I


THE BUSINESS MAGAZINE – THAMES VALLEY – APRIL 2017


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