Tag Archives: research

The Expectation and the Reality of Funding a UK Start-up

In a recent study published by GEM lack of funding was cited as the major stumbling block by 50.6% of people who were thinking about starting their own business. The unwillingness of banks to lend to new and small businesses has been well documented in the media. The government and a whole host of entrepreneurs are currently engaged in trying to solve this issue. Alternative funding sources such as invoice factoring and peer to peer lending are being backed by the government while crowd funding is one of the hot topics of the day.

However the GEM report also indicated that borrowing money from banks or crowd funding start-up capital are not the only options available. It also shows that the expectations about where people think they will get funding do not always match the reality.

Business Coaching for Start-ups: Part 2

Growing Business Start-upsIn our last blog post we looked at how business coaching can be used to help companies develop business plans and raise funding once they are established. However as we discussed with Paul Green, one of the biggest obstacles new start-up businesses face is often getting their initial round of funding.

As well as interviewing Paul Green, who generally works as a business coach for established companies, we spoke to Colin Wilkinson of Incubation UK. Colin operates as an investor rather than a business consult. He picks companies he is interested in and gets personally involved rather than charging a fee for offering advice. Colin has worked with a number of award winning start-ups helping them to revise their business plans and raise funding. An example of one of the businesses that Colin has recently been involved in is Three Sixty Entertainment. They needed to raise £2.7 million to launch their company but had only managed to raise £85,000 in 2 years. Once Colin joined them he helped them to rewrite their business plan, re-asses funding needs and access new sources of finance. As a result they managed to raise the funding they needed with a few months and won an award for start-up of the year. They managed to do this even though it was November 2008, only a couple of months after the collapse of Lehman Brothers virtually stopped business lending.

Colin Wilkinson of Incubation UKWe spoke to Colin about why he is able to secure funding for businesses and how this is applicable to start-ups generally. As with the advice we got from Paul Green a lot of the areas that Colin stressed are about business planning.

Core Business Assumptions – One of the things that Colin stressed the most was the need to do your research. He talked about the need to have solid figures outlining exactly what you are going to sell, who you are going to sell it to, for how much and how often. This research can come from having worked in a similar business, or from suppliers, or from people in the industry your new business is going to be part of. Whatever the source of the figures they need to be accurate, and take account of all costs, as well as sources of revenue. These figures can then be used to test the core assumptions behind the business and establish the likelihood that it can be successful. Colin also emphasised that while you need to be able to show that the core business is going to work, being able to demonstrate the potential to scale the business is equally important. So for instance opening one shoe shop might be great for you but is unlikely to be exciting for a large investor. Being able to demonstrate how you could grow the business will get them excited about the potential return on their initial investment.

Credibility – When approaching potential investors or suppliers it is important that you appear credible. Having done your research properly and being able to show this through the confident presentation of figures is vital. However the people involved in the business can also be important. Showing that you have experience in the industry you are starting your business in can be valuable. Where this is not possible you may need to find people who do have credibility in your new industry to work with you. Colin spoke about the possibility of getting an established figure in your sector to join your company as a non-executive director thereby lending credibility to your board.

Networking -  When we spoke to Colin he kept coming back to the importance of doing your research properly. He emphasised that the research phase is a great time to start establishing your network of contacts through suppliers and established industry players. Getting your name and business known will help to open doors to investors and make it more likely that they will take a meeting with you. It also means that you are more likely to know which doors are worth opening and who you should be focussing on meeting. This is another area where having someone with industry experience on board can help. Experienced figures within a particular industry will know how to approach their peers and what to say to them.

Elevator Pitch – The Elevator Pitch is a well known business technique. It is based on the idea that getting a meeting with the right investor or supplier can often be very hard and so you need to be able to make a convincing case for your business quickly. An elevator pitch should sum up your business idea, and what makes it unique, in the time it takes to go up a few floors in an elevator. When we spoke to Colin he recommended that people really ought to have two pitches prepared. The first he called ‘waiting for the elevator pitch’. This is the first 10 seconds which will get your foot in the door and make people want to hear more about your business. If this is successful then you can go into your full elevator pitch which should last between 30 seconds and 2 minutes. Being able to sum up your business in this short a time shows that you know what you are talking about and have put some thought into it. Again it is a way of establishing credibility and making a good impression.

Throughout the conversation that we had with Colin he emphasised that all of these areas are interlinked. You are unlikely to be able to do a convincing elevator pitch if, for instance, you haven’t done your research properly. Similarly he did not say that it was essential to get outsiders involved in your business but that they can help to point out potential problems and opportunities for your business as well as adding credibility. If you are going to look for a business coach or mentor then Colin recommended that you look for one with experience within your particular sector rather than a generic coach. Above all he emphasised the importance of talking to as many people as possible, business coaches or not, to make contacts and gather ideas.

The Etiquette Of Business


Starting a small business in the UK, most people know the etiquette of doing business. We know how things work and what you should and shouldn’t do. If you don’t then you will soon learn. Starting a new business is a learning experience. Every business owner will be able tell you about the mistakes they made and how they learnt from them.

Of course as the business grows, you might find that you start doing business overseas and this sometimes requires a whole new level of understanding. Japanese business cards are a perfect example. If you don’t know the etiquette surrounding Japanese business cards, then you might wonder what I’m talking about. We’ve all seen the HSBC adverts about the different attitudes and perceptions of people worldwide and this is just another example.

Meishi” is the other name for Japanese business cards and there is a great deal of etiquette that surrounds its presentation to a fellow businessman. For instance, it is apparently necessary to pass the meishi to the other person using two hands and for them to receive it in the same way. Meishi should be stored properly, both by the giver and the taker. Mistreating the meishi is seen as a personal insult, so even something as simple as storing the meishi somewhere where it won’t get warm is a key part of this etiquette. So too is the proper storage of the meishi; which should be filed away according to hierarchical position in a company.

You can see that something as simple as this could make all the difference in dealing with Japanese businesses. As with every other aspect of business, it is important to carry out proper research beforehand. Knowing the etiquette of doing business wherever you are will help you get the edge and succeed where others might fail.

Supporting R&D Companies and High Growth Industry

Support and FinanceThe Government is planning to implement more measures in the next few years to encourage the success of “high growth” companies and R&D businesses within the UK. As well as offering Grants and Financial Support for such companies, the Government is also planning to drop corporation tax on income gained from patents in 2013 (according to a recent BIS Article).

Data gathered around Research and Development carried out by companies within the UK, just published by BIS (The R&D Scoreboard) shows a marked increase in the top companies. Despite being data relating to before the general economic downturn, the signs are still promising and it’s another reason for the Government to wish to assist new businesses in these areas.

If you are looking to start a new R&D company or a company which will be involved in research and development in some way or other, then you will want to make sure you know how to get the most help. Take a look at our article on “Grants and Financial Support For Your New Company” and the BERR website (http://www.berr.gov.uk/) for further help.

Remember that The Company Warehouse is here to help you get started. With budget beating Company Formation packages and a wealth of other low cost, professional business services we’re the best option to help get your new company off the ground. Take advantage of our knowledge and experience, by registering on our site for FREE access to helpful guides, free downloads and special offers.