100% of a £0.5m company or 50% of a £5m, which do you want when growing businesses?

Over the past few months I have been able to go to a few the webinars because I wanted to use the time as a way to gauge how start-ups and growing businesses where getting funding, what were the sources, and how the landscape is changing for companies in the growth cycle.  It was time well spent on my part, mainly because I was very selective on what sessions and seminars I attended.

As an IT professional and manager who  went through the last ‘dot net’ tech bubbles and was a founding director of a technology start-up (before it was sold) I do not know if we are in a ‘new tech bubble’ again.  In particular seeing the eye watering recent valuations going on for technology IPOs and acquisitions, but that is a different story to be told at on another day (yes I do have an opinion on it)…

What did impress me here in the UK is that there are still groups of individuals willing to start up and run ‘real businesses’ and if the proposition is right, there are very many ways for them to get finance and investment.  I have had the pleasure of taking technology propositions around many sources of financing in the past, including private equity, VCs, and high net worth individuals and ‘family offices’.  I have not forgotten how hard it is to get finance even with the best idea but not enough customers.

Also, what I took away from these events was that if you had a good idea, started a company and have a few paying customers, the chances and sources of finance massively increases.  In particular there is a very active sector of the market in ‘corporate venturing’, when a large company invests in your company, either because it is cheaper for them to do so that build your solution internally, or they can put their assets behind you to allow your company to growth at an accelerated rate.  They are not charities, so want a serious piece of the action.

The old adage still applies; do you want 100% of a £0.5m or £1m company or 50% of a £5m or £10m company?  I know which one I would want; even though I fully understand that the proposition is not just about the money.

Please feel free to leave any comments or thoughts, or get in contact with me if your company wants to grow but not sure how to do so and how to get access to the right finance.

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