The initiative, announced by Small Business Minister Nigel Griffiths, will see the Small Business Service (SBS) team up with – and provide funding to – the National Business Angels Network (NBAN). The two bodies will work together to build a new corporate venturing division devoted exclusively to helping small firms meet investment partners. The new division will receive around Â£1.5m for three years from the SBS.
The scheme, however, will hopefully deliver more than just a much needed financial injection to start-ups and small companies. Griffiths hopes that entrepreneurs will find partners who will also bring technical know-how, contacts and facilities to allow small businesses to maintain a technological and competitive edge.
Says Griffiths, “Businesses are like people, with the right partner they flourish… No company has a monopoly on good technology or ideas. No company can develop everything in-house or find everything that it wants on the market. We want to set down guidelines that will help both the investor and the invested make agreements which are in their interest.” Griffiths says he hopes the new initiative will become a”‘blind date’ for business,” and suggests that existing brokers will also benefit as they will gain more exposure to small companies.
The other main benefit of the new scheme is educational. Michael Snyder, chairman of the NBAN, says he hopes to use the new funds to raise awareness of corporate venturing in general. “We aim to look into ways in which we can help and also work with existing brokers and provide guidelines … to ensure small businesses don’t get ripped off.” Griffiths suggests that before entrepreneurs of small start-up ventures accept any financial help, they should ask themselves four basic questions:
1. Would you benefit from access to a global market?
2. Could you expand with your existing management and technical skills?
3. Could your technology be further developed?
4. If all is going well and you’re about to launch a new product can you keep up with demand and still stay profitable?
To find out more information about informal investment log onto www.bestmatch.co.uk .
For more information on how to seek funds from a business angel, contact the NBAN’s hotline on 020-7329 4141.