Breakthrough Issue 2 SPA02 | Page 35

70% of Business angels in the UK invest in technology- intensive businesses • What are your timelines? • Competitors – who and where are they? The Team Investors invest in people, who are fundamental to the success of a company: • Who is going to execute the plan? Are they experienced? A well-balanced team with a track record? • Would you TRUST them to look after YOUR investment? • How much is being taken out in salaries? Forecast and Finance Explain clearly how much money you need and what it will be spent on: • Have you identified profit margins, full costs and overheads? • Is anticipated growth in line with market penetration and can it be funded by existing requirements, or will additional monies be needed? • Investors understand that inexperience may miss things. You can make some assumptions that need more detailed evaluation, but too many unknowns will make them worried. You should at least identify what you think you don’t know! • EIS and SEIS are significant tax benefits B us i n e ss A n g e l s o f f e r s e e d c ap i ta l a n d e ar ly sta g e g rowt h f u n d i n g , a h i g h r i s k / h i g h r e war d strat e g y for investors and most angel investments are made under these schemes – you should get advance approval from HMRC. The Deal and Exit Of course, investors need to know what they will get for their money (share of the company), and how much it is worth: • What is the current valuation? • Who are the other shareholders? • Exit – when, who to and how? What return might investors achieve? Potential returns need to be worthwhile, a minimum of 5x but 10x is more typical and many are far larger. The last Minerva Angel exit was at 12x. • The vast majority of angel investors like a clear exit strategy but a growth / dividend strategy may be considered as an alternative. This would ideally include a payback option. • What will the business need to look like in three-plus years to achieve an exit based on these key variables: Market Penetration, Global Presence, Valuable IP, Customer Base, Revenues, Profits? And what will determine price and future market valuation? Finally, but often forgotten: always ensure your presentation is understandable to your audience and flows well. Know your numbers and aim to demonstrate energy, ambition, focus and direction. ■ The UKBAA is the UK’s Business Angels Association and offers considerable help, including locating a wide range of Angel groups via their website: ukbusinessangelsassociation.org.uk C ENTRE FOR HIGHER & DEGREE APPRENTICESHIPS University of Kent offers Laboratory Technologist and Laboratory Scientist Higher and Degree apprenticeships. • Taking on apprentices is a cost-effective way to upskill your existing workforce, or attract talented people, with up to 100% of training costs fully covered by levy payments or government co-investment. • Apprenticeships are underpinned by degrees in Applied Bioscience or Applied Chemical Sciences. • With flexible start dates (September, January & May), the degree programmes are delivered nationwide via blended learning – a mixture of on-line and face-to-face teaching. For more information, including details on a fully managed service and other higher & degree apprenticeships contact T: 01634 888459 E: [email protected] www.kent.ac.uk/apprenticeships r e a d o n l i n e at: u k s pa . o r g . u k / b r e a k t h r o u g h S u m m e r 2 0 17 | U K S Pa b r e ak t h r o u g h | 3 5