It may be slightly easier than it was before but it is still highly complex and extremely time consuming to find the right source of funding. What options are out there?
Startup Loans. As a loan, it is important to be sure that the business is able to generate revenues quickly enough to make the repayments. Lord Young originally saw this as a way of funding simple businesses. However, it is almost impossible to apply the scheme to more complex business models.
Crowd-funding. Non-equity based crowd-funding is only applicable to a small number of businesses that can ship a ‘product’ or provide ‘rewards’ that the investor desires. Equity based crowd-funding is very new and no-one fully understands the impact on follow-on funding.
Angel investment. I have spent a lot of time talking to London tech angels and I believe that there is a real shortage of capital at the moment. Many of the established Angels with tech experience are invested out. This has created a lack of sophisticated investors who understand the market and can provide guidance to founders.
We have responded to the these challenges by building out our on-line accelerator programme. This autumn we are strengthening our access to investment by bringing on new sources of funding. Our academy will prepare founders for investment and our events will help with exposure.