How did you achieve funding?
We tried everything and looked to go to all of the usual places you’d look to go to when getting funding. We tried all the high street banks and other lending means and we were basically told that we were too high risk. This is even though we had a robust business plan. Since 2008 without physical assets to back up this plan it is very difficult to reassure lenders on the risk they see. Of course, this all changes when you start to make money!
As you can probably imagine this proved to be a soul-destroying process, and for six or seven months we had no real luck but we kept on going with our plan and maintained our belief that we had a really exciting and viable business that we were looking to build.
One thing we learnt through this experience was that the best place to find funding was from industry experts who really understand what you are trying to achieve. If you have a robust plan and present it well to these people, you are more likely to have success.
It really becomes about networking at this stage and casting your net far and wide. I remember speaking to an investor who was an expert in a different market to where we operate, but through this we were passed onto a contact of his and ultimately we found the right investors – you can never have too many coffees when looking for the right person.
What are your top tips for budding entrepreneurs?
A top tip of mine would be not to rush into the first bit of funding you are offered. It is tempting to take an offer that is on the table but you really have to have a think about whether the people offering the funding are the right fit for your business.
Ultimately where you want to get to is where your investors really buy into the business that you are building, and share your vision and ambitions for the company. If this is the case they will look to add real value and expertise to your business. If someone is willing to just put money into your company the likelihood is that they will just look to take money out eventually. Where we are lucky is that our investors are our partners, they share our vision and understand what we are trying to achieve. As such they want to help us build that.
If you're looking at funding a new business, you can read our Boring Money Guide to Finding Funding. It's full of straightforward, practical advice and steps to take. There's loads more about running a business on our Everyday Entrepreneurs page.