Brent Hoberman calls for help for Britain’s start-ups; in the FT he comments with regards to tech start-ups.
Britain leads Europe on almost every measure, more than £10bn was invested in UK tech last year and the sector employs almost 3m people. Beauhurst estimates that more than 1,300 UK start-ups have raised seed rounds over the past two years and now need to raise more funding.
My start-up is trying to raise money to provide affordable advice and guidance to Britain’s retirees. We urgently need help.
Money is out there, we have a promise from a hedge fund which may or may not materialise. There are private equity funds circling. But for our 500 investors, many of whom have invested less than £100 , the promise was more of the same.
What we need at this time is not short-term debt (on offer from hedge funds and banks). What start ups need is proper long-term equity funding.
There are four ways that I propose the Treasury could involve
- It could make immediate Government investment available through grants or equity finance through Innovate UK.
- It could relax the rules on EIS and SEIS so that start ups could go back to the business angels for a limited time and seek further funding from angels under SEIS.
- I suggest that SEIS be extended from £150,000 to £1,000,000 , time limited to the end of 2020.
- Contributions to a SEIS paid within the first two quarters of 2020 could be considered paid in tax year 2019-20.
The logic of this is obvious. The money would enable start-ups with viable business models to ride the storm and use the period of lockdown to develop products and services ready for a more general “return to work”.
Tech start ups need not concern themselves with social distancing, our morning meetings connect Hydrerabad, Delhi, Hampshire and London
The money would save the staff of these organisations being furloughed , the tech start-ups being mothballed and this vibrant success story being cut-off in the bud.
Indeed, when so much needs to be done, start-ups have the entrepreneurial zeal to keep a much wider eco-system focussed on business problems. My diary is full this week meeting senior executives and junior administrators – all of whom will find their call with me energising, entertaining and productive.
I hope that this little blog will be picked up on and shared. I have no right to claim any influence over Government policy, my firm will contribute little to HMRC this year. But those companies who I trade with are mightily important to the British economy, and if they spread the word, maybe my tiny influence can be amplified as far as Whitehall.
At a time when we are in lockdown, it is vital that our start-ups are not shut-down.
You start with 500 disciples and a number who enquired but did not subscribe in the first round.
One solution would be to learn and turn the current contagion to advantage and not only ask the group to subscribe again but to introduce 2 others to the concept and in that invitation to pass on the invitation to the two others
Ask for a minimum which is trivial, say £100, and stick with the current EIS rules because urgent need and change of legislation do not go well together
I will send such an invitation to 100 people that I know have invested in EIS in the last 10 years
Then you have over a million individuals that have received the AgeWage score significantly more than the 300,000 original target. If you can navigate GDPR these could add to your mailing list
Your founders would also be interested in spreading the news of this worthwhile project. “Ask and ye will receive” works but it does not tell you how many times you have to ask