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Qi3 Accelerator Insight

Qi3 Accelerator and friends win 2014 angel investment awards

Qi3 Accelerator, together with some of our close associates and friends, carried away two of the top awards at the UK Business Angels’ Association annual dinner, held this year in Liverpool as part of the International Festival for Business 2014:

Best Syndicated Deal of the Year: Blu Wireless Technology (Supported by the British Business Bank)

First spotted by Nathan Hill at a London Business Angels presentation event, and led by a tour de force combination of Tim de Vere Green and Rajat Mulhotra (Wren Capital), we pulled together a >£2m funding round which has already leveraged ~£1m of regional grant funding and excited further trade interest.  As part of this sterling effort, expert board level input has been drawn in from James Collier (one of the founders of Cambridge Silicon Radio) and Robin Saxby (former CEO and Chairman of ARM Holdings).  It’s exactly this value-add that characterises our investment approach.

Nominated by Angel CoFund for the Qi3 Accelerator Syndicate and the London Business Angels EIS Round Table Syndicate, the deal involved a number of syndicates including the LBA (EIS Round table Fund), Wren Capital and the Qi3 Accelerator Syndicate and the company also secured the investment from a leading semiconductor expert.. The judges felt that there was a strong collaborative approach between the syndicates and proactive interactions between the syndicates, whilst the role of Qi3 Accelerator and notably of Tim de Vere Green, as the lead angel in coordinating the process with the different participants was especially commended.

Angel Investor of the Year: Peter Cowley (Sponsored by Lloyds Bank)

A friend and co-investor over numerous deals, we were delighted that Peter Cowley was awarded the distinction of Angel Investor of the Year.

Nominated by the Angel CoFund, the judges felt that Peter Cowley had demonstrated long term commitment to angel investing having made over 30 investments  to date in early stage businesses across a wide range of sectors and through a range of models including syndicates , alongside crowdfunding and through corporate venturing. Peter has also shown extensive  support for entrepreneurship as a mentor  and educator and  helping to accelerate start-ups whilst taking a strong role as a proponent of angel investing not only in the UK but internationally.

Pointy-headed perhaps, sharp advice certainly

When I tell you that ICAEW stands for the Institute of Chartered Accountants in England and Wales you’ll probably have stopped reading by the end of this sentence – DON’T!

One of their senior people is part of the Number 10 Angel Expert Group that I’ve been attending.  They are pretty proactive and have recently produced a best-practice guide for SME Finance. The guide aims to help entrepreneurs learn how to raise finances and support business growth. It also outlines some of the financing options and key issues that should be considered when looking for financing opportunities. There is a vast amount of information on various topics, such as investment readiness, equity financing, debt financing, etc. If you would like to learn more about financing options for your company, please check out the guide.

Is there a future for High Value Manufacturing in the UK?

Two weeks ago, I was invited to the High Value Manufacturing 10th Anniversary conference. The series covered manufacturing and cleantech, attracting over 80 delegates, including some high-profile individuals such as the 2012 Nobel Prize (Medicine) winner – Sir John Gurdon, as well as the ex-Minister of Science and Innovation and current Chancellor of the University of Cambridge – Lord Sainsbury. I have known Lord Sainsbury for years, so it was nice to catch up with him and learn about his perspective on the current state of the economy.

There were a number of high tech companies from Cambridge and other locations at the conference. I personally presented a speech on ‘Investing in early-stage HVM gems’, and discussed the challenges of early stage investment. The presentation focused on opportunities that may open up for knowledgeable angels, in particular, the prospect for angel syndicates. I also highlighted some important investment factors, including: access to technical knowledge, business experiences, and required funding. Additionally, a good investor should consider the credibility of their co-investment partners. Naturally, this set a good platform to show the audience about the Qi3 Accelerator Evaluation process, and how this specific approach benefits early stage businesses. The presentation finished off with lessons learned from cohort analysis, emphasising a) the need for the team to show a credible business plan, b) realistic assessment of the technology, and c) the lead approach to business modelling.

Reflecting of the conference as a whole, it was clearly a meeting for cognoscenti. It will be interesting to see if it can influence and rebalance the UK economy and manufacturing industry.

Time for some quick due diligence?

There are so many investment prospects where I’m looking for some quick, independent feedback on whether the proposition makes sense in the wider market. Qi3 has recently introduced an Ask the Experts service to support investors undertaking due diligence, and entrepreneurs who seek to provide such independent evidence as part of their due diligence information.

The key when formulating this offering was just how amazingly interconnected Qi3 is with organisations and individuals in the innovation landscape.  The company has a huge range of access points to experts in a variety of domains.  So we’ve developed a strong but simple methodology to deliver this insight rapidly and at moderate cost.

Qi3 asked around and discovered that people would like to hear about 4-6 expert opinions accompanied with records of related conversations. They also like to understand the perspective of Qi3 in assimilating and consolidating the information. The desired time frame for such a service should be approximately 2 weeks. Obviously, the purpose is to provide an affordable service in this difficult climate, and a budgetary cost of £3,000-5,000 sounds good to most people I’ve asked.  Whichever side of a transaction you’re on, see how it can help you.

For further information, please visit our website or contact Nathan Hill

Advice for Entrepreneurs: Part 10 – 4 Steps Towards Understanding Your Investors

Just as it’s vital for me as an investor to understand the team and how it will deliver on the promises made in the Business Plan, it’s also essential that you as an entrepreneur get into bed with the right investors.

Many people are simply looking for financial support to take their vision from dream to reality.  But there are times when money is not enough to allow a business to blossom, and entrepreneurs can benefit from ‘smart money’. Here are four points that you should bear in mind when recruiting investors:

1) People who share your vision

A lot of investors – including me – wish to leave a positive impact on society by investing in fields such as cleantech and healthcare. As an entrepreneur, you should consider whether or not your proposition has such an angle and pitch to investors accordingly. Talk with your investors in detail and ensure that they know your sector and that their heart is in the right place.

2) People with more to offer than money

You have to know exactly the type of person you are looking for. For example: are you looking for a non-executive/executive director? Or do you want somebody with an extensive contact network and who knows potential customers or other investors? It is vital to find investors who have the right skillsets for your business.  As an investor, it gives me great pleasure to introduce companies to high-level contacts when the opportunity arises.

3) People who are reasonable to deal with

Check out your potential investor’s online profiles, think of it as a formal recruitment process to ensure you will be happy working with that person. There are a couple of issues that you should keep in mind:

a) Character. Do the investors always play hard ball or are they reasonable to deal with? Do they understand your needs and circumstances?  Of course you should put yourself in their shoes and try to understand their motivations.

b) Investment requirements. Make sure that you understand the investor’s desired return timescale. In other words, is the investor looking for a quick exit or does he want to invest in the business over a long time-frame?  Is this a big deal for the investor, or one of a large portfolio?

4) People who will support and understand your strategy

Timescale and cash requirements often change based on strategic decisions and external circumstances. It is important to ensure that your existing investors can follow your business and stand behind you through times of change. Otherwise potential new investors may question and become suspicious of your business if existing investors are not supportive.

A good investor is worth more than the gold he bears!

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