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Thank you!

£400m = about $655m
$300m = about £182m

£400m ‘roughly the same amount as’ £182m? It’s less than half.

How are these sums comparable?

Perhaps before speaking for the people of Britain you could do us the courtesy of learning to use our language.

The benefits for British businesses of being at the heart of the European Union are manifold; by dismissing them all in such a lumbering way you sound like a commenter on The Sun newspaper’s forum at best, a UKIP voter at worst. For shame.

And 53rd state? Which, to your “mind”, are the 51st and 52nd?

Dolt.

Given we are UK based, early stage and raised money this month we are in a minority. I wanted to share our approach to investment and in particular how it changed as it became increasingly clear we were heading into a significant ‘down market’.

We started actively talking to potential UK investors in last year. Something quickly became clear, VC’s were unsure where the market was heading but they were still actively talking to companies that could tick the critical boxes:

1. Have you done it before
2. Have you invested your own money
3. Is the business in potential growth market

The same questions investors have been asking for years, what changed was the priority. In the recent ‘mini boom’ the 3rd point was the focus, increasingly now VC’s want to see experience and serious financial commitment. The assumption is an experienced team is more likely to be able to weather the storm and adapt their business model as needed.

Next up we spent two weeks in Silicon Valley. Six weeks before we left we called/emailed the great and good and managed to set up 14 meetings. I’d encourage UK companies to go to Silicon Valley as the lessons we learnt there were invaluable. I’ll temper that with the following:

1. Set a firm goal on the number of meetings you need as a minimum to make the trip viable. If you don’t line enough up don’t go.
2. Don’t expect to close funding. There is much more VC money in the US but the likelihood of getting funded by a US VC without being set up as a US company is very slim.
3. Listen hard. If several VC’s say the same thing then they’ve probably got a point. We changed our business plan as a result of our trip.

Back in the UK it became clear that the market was most definitely becoming less healthy. The steps we took to increase our chances of funding were:

1. Lowered the level of investment needed
2. Actively pursued Angels. I’m sceptical about Angel Networks but we did get some great traction with London Business School E100 Network of Angels. We combined this with tapping up contacts and contacts of contacts.
3. Significantly widened our search for VC’s.

The new ‘leaner’ plan and the widened search significantly increased our traction. We came close with a group of 8 Angels Investors but ended up securing funding with a great UK focussed VC – Dawn Capital (http://www.dawncapital.co.uk/).

So the final ‘lesson’ that I think applies to fund raising in a down market is persistence. Sounds obvious but I think one thing us Brits have a tendency to do is not be aggressive and driven enough in our approach. The point to remember is there is still money out there that VC’s want to invest.

Apologies for the length of this post, certainly I don’t claim to have all the answers but I hope sharing our experience helps UK entrepreneurs in some way.