Capital EnterprisePresentation on Funding For Start-

ups in London .

Step 1. Know what stage you are on the fundraising cycle

Stage Status

Pre seed Good Idea, Founder Team are developing a full business plan and completing market research, registering IP and confirming the business opportunity.

Seed Opportunity demonstrated. Engage in set-up activities, developing product / service to ‘proof of concept’- market testing.

Start up and Series A Launched company-entered market and rapidly approaching break-even sales. Hiring key employees –ready to scale up.

Step 2- Know the different Sources and types of Finance

• Bootstrapping through Personal resources (time and money = sweat equity you are investing)

• FFF- Family Friends & Fools – People who will give you funds with little questions asked.

• Customers and Suppliers- “Build slowly at low risk by growing business through profits from supplying customers”

• Loan providers- “Increase business growth ambitions by incresing investment by taking out debt”– Banks ( Overdraft-unsecured and secured loans)– Specialist lenders (Factoring, invoice discounting etc.)

• Investors-– Private Investors- Business Angels– Venture capital– Government Backed Investment Funds

Matching the right mix of sources to the right stage and type of finance is the key to successful fundraising

Step 3- What do you need Money for? Type Amount Purpose Provider

Set-Up-Pre-seed- before trading

VariesUp to £100k

Get the business set-up- e.g. legal fees, Equipment, website, accommodation

Founders ‘bootstrap’, - Sweat Capital, Family & Friends, Personal Loans & Credit Cards. Over 90% of new businesses start-up on less than £10,000

Research & Development Capital ( If doing something new and innovative)

VariesUp to £0.5m.

Proof of Concept Funding.Market testing Intellectual Property Registration.Time

Bootstrap- Finance whilst working elsewhere or as consultant. Private investors alone or in groups. Government Grants/ Tax Incentives e.g. TSBOpen Innovation Collaborations with industry/ HEIDefinitely not banks

Working Capital Varies To fund cashflow cycle (once you have orders)

Customers & SuppliersBanks/ Factorers/ Invoice Discounters/ credit cards

Scaling up/ GrowthSeries A Investment

200K- 2m Commercialisation of “proven” technology.Roll out of growth plans

Private investors alone or in groups/ dedicated seed funds, specialist VC’s alone or in syndicates. Government Backed funds.VC’s only if more than £1m- below more likely angels.

Step 4: Check out you funding options?

Information:

• Capital Enterprise What’s On in London- www.capitalenterprise.org/whats-on • Business Link - www.businesslink.gov.uk • Start- up Britain - http://www.startupbritain.org • British Library- www.bl.uk/bipc • HMRC Small Company Enterprise Centre- Source of advice and help

http://www.hmrc.gov.uk/manuals/vcmmanual/VCM10050.htm• HMRC R& D Tax Credits www.ucl.ac.uk/advances/advances-news/hmrc• HMRC Guide & Support- http://capitalenterprise.org/guide-to-rd-tax-credits • British Business Angel Association: www.bbaa.org.uk • British Venture Capital Association: www.bvca.co.uk/• London Funding Conference: http://www.londonfundingconference.com/about-funding • Guide to Early Stage Investment: http://www.paloalto.co.uk/about_us/Early_Stage_Investment_by_Alan_Gleeson.pdf • British Franchise Ass- http://www.thebfa.org

And if you have not checked them out please look at the latest schedule of advice and training events at :www.thebusinessbootcamp.org.

Step 4: Check out you funding options?

Networking & Accelerators• London Technology Network: http://www.ltnetwork.org/ • Knowledge Transfer Networks: https://ktn.innovateuk.org/web/guest/home • Mini-Bar: http://www.openbusiness.cc/ • Lean Camp : http://leanca.mp • Seed Camp: http://www.seedcamp.com • Start-Up Weekend: http://london.startupweekend.org • Launch 48: http://launch48.com• Tech Hub : http://www.techhub.com • The Business Bootcamps- www.thebusinessbootcamp.org• Innovation Warehouse- http://www.theiw.org • Hubventurelabs - http://hubwestminster.net/hubventurelabs Practical Help• Gateway2Finance-

http://www.ufblondon.org/what-is-understanding-finance-for-business?/gateway2finance • Gateway to Investment

http://www.ufblondon.org/what-is-understanding-finance-for-business?/gateway2investment • UCL Advances-HELO Project ( Student Interns)- http://www.ucl.ac.uk/advances/business/support/helo • E-Innovate- http://www.gle.co.uk/advice/developing-innovation.php • Enternships- http://www.enternships.com • Enterprise Agencies & Incubators- www.capitalenterprise.org/members • Mentors Portal- www.mentorsme.co.uk

Step 4: Check out you funding options?Grants & Awards• J4B- Portal for grant finding http://www.j4b.co.uk• Technology Strategy Board ( R&D Funding) - http://www.innovateuk.org -

http://www.innovateuk.org/content/competition/grant-for-rd-single-business.ashx• London European Enterprise Network- http://www.een-london.co.uk • E Funding for SME R&D - http://www.eurostars-eureka.eu/what.do• EU Funding for R&D collaborations: http://ec.europa.eu/research/participants/portal/page/calls • Knowledge Transfer Partnerships funding support-

http://www.ktponline.org.uk/ktp-what-will-it-cost-my-business

Translation/ Follow on research funds. • www.rdfunding.org.uk/bulletin/queries/Search.asp?TheCloseMonth=July&TheYear=2011.• http://www.rcuk.ac.uk/kei/ktportal/Pages/Followon.aspx• https://ktn.innovateuk.org/web/145175/overview• http://www.wellcome.ac.uk/Funding/Technology-transfer/Awards/Translation-Awards/index.htm • http://www.bbsrc.ac.uk/business/commercialisation/follow-on-pathfinder.aspx • http://www.epsrc.ac.uk/funding/grants/business/schemes/Pages/followonfund.aspx • http://www.nerc.ac.uk/research/programmes/bess/events/ao3.asp• http://www.nerc.ac.uk/using/schemes/followonfund.asp

Step 4: Check out you funding options?

Debt Funding Initiatives• Enterprise Finance Guarantee ( Government underwriting UK banks business loans-

http://www.rbs.co.uk/business/borrowing/g1/firms.ashx • CDFA ( Soft Loans from Community Banks- http://www.cdfa.org.uk • Manufacturing Funding- http://www.rbs.co.uk/business/borrowing/g1/manufacturingfund.ashx • Examples of New types of funding: • http://www.marketinvoice.com• http://www.fundingcircle.com • http://www.thincats.com• http://www.firstfunding.org • Green/ Energy Efficiency loans:

http://www.carbontrust.co.uk/cut-carbon-reduce-costs/products-services/financing/pages/financing.aspx

Incubators ( Discounted accommodation & support)• Camden Collective ( Creative) - http://camdencollective.co.uk• Hatton Garden Jewellery Centre- http://www.centa.co.uk/hattonjc.html • CEME ( Science & Engineering) - http://www.ceme.co.uk • LBIC (Bio-Tech) - http://www.lbic.com • Innovation Warehouse- http://www.theiw.org

Step 4: Check out you funding options?

Equity Finance• NESTA - www.nesta.org.uk/investments • London Business Angels: http://www.lbangels.co.uk • London Seed Capital - http://www.londonseedcapital.com/ • Oxford Early Investments- http://www.oxei.co.uk/about.php• Envestors- www.envestors.co.uk• Paste & Wait Investment (USA only) www.kickstarter.com • Paste & Wait Investment. www.indiegogo.com• Crowd funding: http://www.pozible.com • Crowd Funding : http://www.crowdfunder.co.uk • Crowdfunding: http://www.crowdcube.com

Early Stage VC • Amadeus- http://www.amadeuscapital.com/about-seed.php• Balderton- http://www.balderton.com• DfJ Esprit - http://www.dfjesprit.com • Doughty Hanson- http://www.doughtyhanson.com/technology-ventures.aspx • Early Bird Ventures- http://www.earlybird.com • Index Ventures- http://www.indexventures.com • Octopus- www.octopusventures.com • Anthemis ( Finance & Technology): http://www.anthemis.com • London Technology Fund: www.londontechnologyfund.com

Step 5: So remember –What’s important when seeking finance

•The quality and “connections” of the management team•The size of the business opportunity/ funding need•The scope for building a sustainable competitive advantage•The level of risk/ security. •And the timeliness of the proposal

Will determine the attractiveness of your business to investors, lenders and funders

•The ability of the entrepreneur to negotiate well and of the team to execute the business plan convincingly

Will determine the type, price and quality of the deal that can be achieved