BehindTheRaise with Pantee

Tell us about what got you into startups:

A few years ago when myself (Katie) and my sister (Amanda) learned about the sheer amount of waste produced by the fashion industry, we knew we had to do something about it. So, we came up with the idea to launch Pantee – the world’s first underwear brand made from deadstock t-shirts. 

Raised remotely during the pandemic, we began bringing Pantee to life in late 2019 and after a year of research and product development we launched pre-orders on the crowdfunding platform, Kickstarter, in November 2020. 

Katie and Amanda McCourt, Co-founders, Pantee

Why did you decide to raise investment?

From day one, we have been on a mission to disrupt the fashion industry and build a brand that pushes the boundaries of what can be achieved with deadstock fabrics and by upcycling. We planned to raise the investment from the beginning, first with a crowdfunding round on Kickstarter and now with an SEIS raise with Angel Investors. We wanted to do this to give us the resources to further amplify our mission and set us up to create a greater impact in the future.

What is your top tip for anyone raising investment for the first time?

I think everyone would say this, but don’t be disheartened by the rejection. As first time founders, we found the process of raising very difficult and we rode extreme highs and lows from start to finish. You’ll hear so many no’s, but it isn’t necessarily a reflection on your business or your idea – you just might not have been speaking to the right person. 

What attracted investors to your company?

We were able to prove a strong amount of early traction that Pantee had received within the first few months since launching our D2C eCommerce store. 

Within a short time of launching, we had grown an engaged community of over 10,000+ women, were racking up 5* reviews on Trustpilot and had been featured by the likes of Vogue, Stylist Magazine, Drapers, The Observer and named a ‘Top Sustainable Underwear Brand’ by The Independent.

During the raise period, Pantee also received recognition from major global tech companies having been featured on Shopify’s ECommerce Masters Podcast and awarded Klarna’s Small Business Support Package.

This really helped us to prove to investors that the brand was not only resonating with early customers that loved the product, but that it was innovative and newsworthy – building their confidence in our brand awareness capabilities. 

My biggest fundraising mistake was…

Don’t underestimate how long you need and celebrate every win, no matter how small. 

Raising investment can be a long process.  It’s never too early to start building relationships with investors to instill confidence in both you and your idea. Get them excited about your business and take them on the journey with you, the more involved you get people early on the more likely they will invest, in my opinion. 

It’s really easy to get bogged down by the no’s which you will get a lot of, in most cases more than the yes’. Don’t let it slow you down – we were given some great advice by a fellow startup founder who advised us to ‘learn to enjoy the rejection’ – once you stop taking it personally it allows you to learn from it – in a productive sense! 

Why did you choose to use the Angel Investment Network?

We signed up to the Angel Investment Network halfway through our raise to expand our search away from our own network and connect with new investors from different backgrounds. It was a great decision as it led us to connecting with one of our biggest investors that was instrumental to helping us close the round.

What has the funding enabled?

We have just closed our SEIS raise and have already begun putting in place our strategies to further amplify brand awareness, build a core team, expand upon our lean product range and certify our sustainability efforts with accreditations.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

Fundraising New Year’s Resolutions for Startups

Whilst we’ve seen some huge successes in terms of fundraising in the last year, it’s important to remember the companies that have been successful, not only have worked very hard and persisted to get there, they often have clever hacks and systems to help. 

As many of you are thinking about new year’s resolutions from a personal perspective, here are some recommendations for hacks, tips and processes that could improve your fundraising in 2022.  

Look after yourself to look after your startup  

Get exercising

Running a startup means there is always too much to do. Important investor meetings get diarised, exercise and eating healthily, not so much. But if you are not creating the best version of you, are you going to be presenting your start up optimally when you pitch to investors?

Make sure you are looking after your physical and mental health, it will likely pay off with you presenting yourself in the best manner possible, and in the quality of your pitch with investors.

Sleep well – keep your phone out of the bedroom 

Avoid blue light – keep your phone out of the bedroom

Now’s the time to start getting some actual quality downtime. If you check your emails in the middle of the night, it can quickly become a self enforcing habit that effects your sleep and alertness.

Lack of sleep has a number of negative effects, including impacting memory – important when recalling key metrics in investor meetings.

Keep your phone out of the bedroom and ideally have a pre-bed curfew to avoid blue light before bedtime. Leave it charging in another room over night to ensure that this doesn’t slip. 

Try the Pomodoro Technique

Raising investment whilst balancing the everyday tasks of running a business is an arduous process, it’s easy to get bogged down in the never ending cycle of replying to emails and firefighting tech bugs and customer complaints. 

Reclaim your time by planning and blocking out time using the Pomodoro Technique. 

With the Pomodoro Technique, you create a list of the key tasks that you need to do. 

Break the tasks into 25 minute segments (the optimal amount of time that people can generally concentrate effectively for).

Then fill your day with the appropriate amount of tasks. Set a timer for 25 minutes and get started on the task in hand, ignore the temptation to check your email, or anything else for that matter. When the timer ends, have a scheduled five minute break before jumping into the next segment.   

It’s a unique way to stay focused, avoid distractions and obtain a sense of flow when working. Find out more about the Pomodoro Technique here.

Pimp Your Zoom Set Up

External webcam versus internal webcam

The large majority of investor meetings are still happening virtually, and it looks like that might be a lasting legacy of the pandemic, with all but a small minority of later stage meetings likely to take place over video calls. 

With so many investor meetings, how can you make sure that you present yourself in the best possible way? Firstly using meeting scheduling software such as Calendly can be useful for sharing gaps in your availability, making it easier to coordinate meeting times with investors – it can also be integrated with Zoom or Google Meet to automatically schedule a video call.

Think about your backdrop – what kind of message do you think a cluttered backdrop sends to investors? You could use a virtual background, but sometimes using a real background will give investors some insight into what you like and help build rapport, whether it’s books you enjoy reading, pictures or some unique memorabilia. 

Whilst you can make it work with pretty much any kit for video calls, having an external mic will make your voice feel warmer, like you are there in the room; an external webcam can give you a much clearer image and more of a contrast to get you stand out from the background; and a ring light can help you ensure that you maintain the focal point. 

Find more tips here.

Use a CRM 

CRM for investor management

Do you find fundraising dispiriting? You’re not alone. Investors are typically very busy and often looking to invest in something that specifically meets their criteria, meaning that it’s not uncommon for messages to not receive a response.

On the Angel Investment Network platform, you can keep track the stage of investor conversations. You can also use software such as Pipedrive, ForceManager or Trello to categorise your investor conversations by stage.

It means that you can set yourself clear targets: i.e get X number of investor meetings this week, rather than fixating on the goals of raising investment, which can take longer, and you need to focus on getting more people through your funnel to get yourself in a position where they will convert.

CRMs have the advantage of letting you set yourself reminders to follow up with contacts, giving you analytics as to how long it is taking for contacts to get between stages, as well as adding in automation, i.e an email that it sent to investor contacts when they get to a specific point in your funnel.

In Summary

We hope you have had a chance to restore over the festive period and have come back invigorated. If you are about to embark on a fundraising journey, now is the time to think of a few habits and hacks that could go on to pay dividends for you. 

Wishing you every success in 2022.

The AIN Team

Tips from the Top: Transitioning from founder to leader, how to be the one in five

In the next of our Tips from the Top series, we speak to Ed Lowther who leads The Soke’s Founders Development Programme, a first-of-its-kind course designed to provide vital knowledge, understanding and skills to founders at the helms of fast growth businesses.

When Harvard Business School spoke to its 141 HBS alumni who led start-ups, they asked: “What does someone who aspires to your role need to know?” The research revealed that of all the possible areas to focus on, there are two essential areas that over 80% of the group unanimously agreed on.

At the outset, a founder needs to assemble a founding team – a series of vital decisions around choosing co-founders, appointing key talent, splitting equity, recruiting advisors, and managing a board. These are all vital, but highly demanding tasks that a founder must achieve alongside building their new business that if not done correctly can lead to early failure, no matter how brilliant the idea. Founders reach these decisions through a combination of instinct, experience and the use of trusted advisors or mentors, in combination with key skill development.

Secondly, for those looking for investment, or looking to invest, a founder needs to foster a critical set of leadership skills needed early on, that in turn helps to attract further investment and support the business on its path to success. What’s clear is that early development of specific leadership skills in communication and conflict management is where a founder can really differentiate themselves.

Whilst many founders may believe that they naturally possess the skills to successfully build their business to success, the reality is that few come to the fundraising table with the array of skills needed to successfully lead an organisation from an idea through the teething stages to growth and finally exit. This is particularly the case when founders are required to run a company not purely to satisfy their own ambition (management, creative, financial, or otherwise), but to meet the expectations of investors and other stakeholders, including staff.

So what steps can founders can take to improve their skills in communication and manage conflict with their co-founders or staff?

  1.  Your business is founded on a great idea – it does not mean all your ideas are great.

In business journals, strategy reports and insight magazines, much is made of creativity being at the heart of business success and growth. Tesla CEO Elon Musk is vocal in encouraging his employees to think creatively, eager for them to predict future trends and allowing them to share their ideas freely, to improve the prospects of the company. The stratospheric growth of Tesla suggests that his approach is bearing fruit.

For those at the beginning of this journey, the thought of fostering creativity can feel like a luxury, alongside all the other business demands. Innovation is however proven to create growth. Businesses at all stages need to remain nimble as their customers’ needs and demands change. How successfully a founder facilitates the communication of ideas around their business and across functions is a marker for future innovation and adaptability for the business idea to survive in the market. 

Create dedicated time for creativity and innovation as part of routine business operations, giving space for open communication between the founder and team members of all functional areas. Foster an environment for the team to be creative and openly communicative, without it all being founder-led, so that ideas are assessed on their own merit, whatever the role of the team member in the company.

  1. Learn to share through building communicative resilience

Once a founder has the fundamentals of their new business in place, the idea is taking hold in the market and revenue is growing, it’s an exhilarating time. Few businesses can grow rapidly through organic growth alone and therefore a founder must also accept the challenge of securing capital through external sources. It can be an exciting but risky time, with a number of factors that can damage a business just as it begins to succeed. Much of the damage comes from the amount of time that is needed, coupled with the energy required to be successful, which takes away a founder’s dedication to their clients. Customers can sense neglect, just at the moment a business wants to secure their lifelong loyalty.

At this moment, a founder will be at their communication limits, often exhausted by the sound of their own voice, as they describe the brilliance of their business, the financial plan and the superb team assembled to make it succeed, to yet another room of potential investors. The key skill to develop here is ‘communicative resilience’, a combination of sustaining a consistent and engaging narrative of the idea, clear understanding of the business strengths and challenges, and a willingness to answer penetrative questions designed to interrogate a founder’s financial shortcomings. This combination tells investors that you can share this with them and make it successful at the same time. 

Be mindful that you communicate the strengths of the business in a way that puts the business idea at its heart and that through additional financial support, this idea will flourish. The moment that investors sense that a founder does not want to share and is more interested in their own success irrespective of the idea, the fight for their funding is lost.

  1. Conflict is inevitable – fail to prepare for it, prepare to fail.

It’s likely that as a founder builds their team, they have been successful in recruiting a diverse team, all with unique skills and often varied or differing opinions. In fact, this diversity is often a key ingredient for driving a business forward as these individuals bring perspectives to the founder that they would not otherwise have seen, helping them grow the business successfully.

The differences in this team that exist through individual variances of cultural background, learning styles, personality and many more factors besides, overlaid with managerial expectations, accountability issues and communication styles, will inevitably lead to conflict. And at this point, the founder needs to establish a pathway that is neither a hierarchy of opinions, where ‘I win because I’m more senior,’ or that a conflict is simply ignored.  Without establishing this early on, conflicts cannot be resolved satisfactorily and can lead to increased stress and decreased performance in the team, which will impact business growth. 

Plan to navigate conflict by setting out a framework for all employees to identify and resolve issues between each other, building a culture that celebrates diverse perspectives with a way to manage the conflict that this diversity can bring. It will help shape the best outcomes for the business and build genuine trust and respect between team members, managers, and the founder.

#SixtySecondStartUp with Society

Up next for #SixtySecondStartUp we have Matthew Billington, Co-founder of Society. Matthew noticed that student usage of Facebook was falling off a cliff and set up a startup to help student societies manage their members with their own branded apps.

What does Society do?

Society is your own branded community app in an instant. With over 1,700 clubs with group chats in over 217 Universities in the UK and worldwide, Society is now the fastest growing app at University for clubs and societies.

App features include push notifications direct to all your members for instant alerts and updates for events and announcements. It has your club’s calendar of events, an instant searchable network, personal profiles, direct messaging, group chats, free e-tickets and much, much more. And, it’s completely free for students. 

The Society App

Why did you set up Society?

When I entered my 4th year as a dental student at King’s College London, I soon discovered that being elected President of the KCL Dental Society of 800 members came with its fair share of problems. Engagement was falling and falling, Facebook was becoming increasingly outdated especially with freshers. Year on year, we were seeing a progressive decline in engagement with university students.

With popular event booking platforms such as Eventbrite and Fatsoma, having high transaction fees, I wanted to create a platform with the lowest possible ticket transaction fees for students, whilst remaining free for free events. WhatsApp groups were also a terrible way to manage a society and events. 

How did you get your first customer?

After engaging with Presidents from other dental schools I soon discovered that nearly every new President of a university society is in the same boat, re-creating the wheel, each and every year.

I originally came up with the idea of the Dental Society app to have a profound and positive impact on committees and society members at all 16 dental schools. Helping committees to save time through automating event management, certificates, ticketing/e-tickets for events, whilst having the committee displayed and available for all members to directly contact through the chat. 

We knew we were onto something when?

Suddenly, the Presidents of King’s College London Medical Student Association wanted to use the Dental Society app. Then 18 months ago when the app was re-engineered and relaunched as “Society” for all student clubs, Aston’s African Caribbean Society wanted to use the app. That’s when we experienced exceptional growth from 12 clubs to 800 clubs to now over 1700 clubs in the last 18 months.

Our business model:

Society co-founders chose pre-monetisation to maximise and prioritise viral growth without friction. Over the next 12 months, we are proving multiple revenue streams to find optimal ways of aligning monetisation with viral growth.

Our most effective marketing channel has been:

Word-of-mouth with students. The new academic year saw more than two hundred Society Ambassadors attend Freshers Fairs at Universities across the UK to promote the Society app to clubs, societies and students. All ambassadors wore the Society hoodie while spreading the word about the features and benefits of the app. The awareness campaign was a huge success.

Society Brand Ambassadors

What we look for when recruiting:

Insanely great people with ideas and raw talent, passion and energy that don’t need to be managed. They have to believe in the Society app, our vision and be fun. 

The biggest mistake that I’ve made is:

Not immediately realising the full potential of the Society app as an instant community app for absolutely everyone in the world. ESN UK is set to digitise the student exchange experience with their new Society App partnership. Formally the Erasmus Student Network, ESN is the largest student-led organisation in the world in over 1,000 Higher Education Institutions in 42 countries.

Together with Society App, ESN UK are launching a new app specifically for their members to help them to develop skills to a higher proficiency. As seen in The Daily Telegraph, the ESN partnership presents a global opportunity for the Society app and is one of the pathways to having a world-wide presence in 2022 with student brand ambassadors in every country.

We think that there’s growth in this sector because:

Significant traction has been made in the new academic year post covid lock downs. In the last 90 days, clubs have doubled and grown by 100% across 1,700+ Clubs, now also with 1,700+ Group Chats. Memberships have grown by 130% and engagement has grown by 700%. Over £50,000 has been collected via Society Pay, the in-app payment gateway. This exceptional growth since launch only 18 months ago, means the Society app has already cornered 13% UK market share and is expected to double in 2022.

The app’s success reflects UK University only, excluding parallel, international and enterprise markets. There’s still time to invest in the Society app (EIS approved) this year to support the team growth of student brand ambassadors and react native developers, which will allow greater scale and global ambitions to be achieved. 

We worked with AIN because:

AIN was highly recommended and we found AIN to be one of the best ways to reach and communicate with potential investors.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

#SixtySecondStartUp with Alpaca Coffee

In this week’s #SixtySecondStartUp we catch up with Alpaca Coffee who are making ‘better coffee for you and the planet’:

A ceramic coffee mug is great for sipping hot drinks like tea or coffee, go to Spice Kitchen and Bar to take a look to the 11 Best Ceramic Coffee Mugs of 2022: Reviews & Top Picks.

  1. What does Alpaca Coffee do?

Alpaca Coffee looks to bring better coffee for you and the planet. We are working towards being UK’s first fully sustainable coffee brand by promoting sustainability at every touchpoint:

Ethically-Sourced Specialty Coffee: Traceable sources to support family businesses that adhere to international standards on sustainability, better pricing, and quality

Zero Waste Roasting: Roasted via circular technology with biofuel instead of fossil fuel 

100% Plastic Free & Compostable: 100% plastic-free, from our labels and our bags, all the way to our shipping boxes and compostable tape.

Offsetting Our Carbon Footprint: For every 10 bags of coffee sold, Alpaca Coffee will plant one tree in the Amazon Rainforest.

  1. Why did you set up Alpaca Coffee?

I fell in love with specialty coffee during a trip to South America, but soon became aware of the negative environmental impact of the coffee industry. Due to this, we decided early on to become the new industry standard and to put sustainability at the core of what we do, making quality and sustainable coffee accessible for everyone. 

  1. How did you get your first customer? 

We validated our idea with a Kickstarter campaign. The featured by Kickstarter and our >200% oversubscription jump started our initial customer base and we are fortunate that a lot of the customers from then have stayed with us since then. Despite the fact that we have grown since then, I will never forget the moment my best friends tried our coffee and their amazed look. 

Alpaca Coffee

  1. We knew we were onto something when? 

Kickstarter was a start, but when we were featured by the UK Government as part of the SMB Climate Hub, among other publications such as Goodfind and Wherefrom, we knew we were onto something. 

  1. Our business model: 

B2C with a focus on e-commerce. We are rapidly expanding into the retail and B2B space so hit us up for a chat ?

  1. Our most effective marketing channel has been: 

We are currently organic-heavy with our marketing, and so far has offseted >1,300,000 grams of carbon with >3000 bags of coffee sold. Social media has brought in great ROI, from word-of-mouth through user-generated content to collaborations with brands with similar philosophies. The team is working hard to further our presence by strengthening our branding and unboxing experiences. Stay tuned for our launch in December ?.

  1. What we look for when recruiting:

We look for people who share our values in sustainability and understand our mission. Being a challenger brand, we want to recruit fearless, passionate people. Diverse backgrounds, perspectives, talents, and ideas are important to us and we are driven forward by this diversity.

Coffee?

  1. The biggest mistake that I’ve made is:

Saying yes to too many things. I’ve learnt that it’s important to approach any part of our business with a clear goal and understanding of the return on investment. We now approach anything we do together as a team with a clear understanding of how it fits with our mission and vision, and how it drives the business forward.

  1. We think that there’s growth in this sector because:

We are part of the “fourth wave of coffee”. As one of the most consumed drinks in the world, the quality of coffee as well as its impact on the environment and society, has become increasingly important to people around the world. As a specialty coffee company with sustainability at its core, we hope to become the new industry standard and push for better coffee for you and the planet. 

  1. We worked with AIN because:

AIN democratises angel investment and offers an unprecedented access to a supporting ecosystem and community of entrepreneurs and investors. This helps level the playing field and empowers entrepreneurs like us to grow. 

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

#SixtySecondStartUp with IBS Coach

Liamhl Asmall shares the story of IBS Coach, a digital dietary treatment for the 800 million people affected by IBS.

  1. What does your company do?

We help the 1 in 7 people who suffer from Irritable Bowel Syndrome to get instant and effective digital treatment from the phone in their pocket. It may come as a surprise, but IBS is one of the most common digestive conditions on the planet. It’s not life threatening and is still taboo (which is most likely why it’s been so overlooked for so many years), but it severely impacts relationships, work, travel, and ultimately, quality of life.

In one study patients with IBS were willing to give up 15.1 years of their remaining lives to achieve perfect health. People are desperately seeking a cure.

  1. Why did you set up this company?

Healthcare for IBS is inefficient and unaffordable. It is incredible that patients have to wait a reported 1 year to see a specialist on the NHS, or pay up to £320 for private treatment. We set out to solve this problem that our friends and family had faced. Our mission is simple: to make effective digital treatment accessible, affordable, and scalable for this 800 million person IBS healthcare market.

The IBS Coach App
  1. How did you get your first customer? 

When developing a medical product you’ve got a long road to walk before you can sell to customers. Our journey went from achieving medical compliance to setting up a closed beta testing group for people with IBS, to launching in the app stores. The overwhelming positive feedback gave us confidence that patients would buy our product. We launched commercially in October this year and had our first sale almost immediately. It’s a good feeling to know we’re helping people manage their IBS.

  1. We knew we were onto something when? 

We interviewed 30 people with IBS at the start of our journey and just listening to their stories and frustrations showed us there was a clear need for an affordable, simplified treatment for IBS. Very early on we shared a post on Facebook and had almost 200 sign ups in the first 24 hours. These were early points of validation and were supported by lots of desk research.

  1. Our business model: 

IBS is a lifelong condition that needs ongoing symptom management. Because of the ongoing nature of IBS, we aim to support patients throughout their life. The business model is a recurring revenue subscription and we are currently testing our acquisition channels and pricing. One of our goals is to establish a marketing flywheel with our next SEIS fundraise. 

  1. Our most effective marketing channel has been: 

Organic sales in the iOS app store. We’re now putting marketing spend behind Apple Search Ads and Google Ads which are ‘high intent’ channels. We’ve run multiple Facebook campaigns to test landing pages and messaging, and we’ll be exploring ways we can partner with brands.

  1. The biggest mistake that I’ve made is:

One of the early mistakes was focusing too heavily on the product (we have a great product, and as a medical product we perhaps needed to spend a lot of time here!). However, if I were to start over I’d spend slightly less time on product and more time testing sales channels. It’s a fine balance as founders have to wear many hats. The risk is that founders focus on the jobs they like, or feel most ‘comfortable doing’. It’s good to be aware of our bias towards tasks.

  1. We think that there’s growth in this sector because:

IBS is a lifelong condition and the latest reports suggest the rates of IBS have actually increased during Covid. Couple the above with the mass adoption of digital healthcare, the large unserved market, and the scalability of our effective digital program and we have the right trends for our company to grow. 

  1. We worked with AIN because:

AIN has a reputation as one of the best platforms to share our ambitious plans with engaged angel investors; We hope to make many new connections and raise our current SEIS round.

If you are interested in learning more about IBS Coach, please get in touch via the Angel Investment Network platform.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

AIV Capital completes investment into meat alternatives business Eat Just Inc.

AIV Capital has announced investment into alternative food business, Eat Just Inc. Eat Just Inc develops and markets plant-based alternatives to conventionally-produced egg products. Founded in 2011 by Josh Tetrick, the San Francisco based business is reducing dependence on chickens and battery farms for egg production by creating a realistic and viable alternative from mung beans.

Eat Just Inc. has raised over $500Mn to date and will use its latest round of funding to continue to improve the unit economics of the business and to focus on international expansion outside of the US. It was announced recently that the key ingredient in its plant-based JUST Egg products received approval from the European Food Safety Authority’s (EFSA) expert panel on nutrition. This opens a pathway for the initial launch of JUST Egg to occur in Europe in mid-2022. Its high profile produce was also on the menu at Barack Obama’s recent 60th birthday.

The company has also raised over $400Mn for its subsidiary, Good Meat which focuses on cultivated meat as an alternative to traditional chicken based products. Good Meat is the first company in the world to receive regulatory approval to sell the cultivated meat products which are now available in Singapore. Earlier this year, the company secured rights for a manufacturing facility in Qatar as a partnership between Doha Venture Capital (DVC) and Qatar Free Zone Authority (QFZA).

AIV Capital is the recently launched institutional investment arm of Angel Investment Network, the world’s largest online angel investment platform. Led by experienced investment manager Ethan Khatri, AIV Capital’s focus is on investing between $10 -$75Mn+ into established businesses ranging from Growth/Series B to pre-IPO and has a flexible approach utilising both primary and secondary capital. 

According to Khatri: “We are delighted to have partnered with CEO, Josh Tetrick and the team at Eat Just Inc. With the demand for plant based products soaring they offer a viable alternative to conventionally-produced egg products and are offering impressive returns for all stakeholders. This is a prime example of the sort of business we will be working with at AIV Capital. One with a strong management team with a demonstrated edge in the space they operate in.”

BehindTheRaise with Paperclip

Rich Wooley is the CEO and founder of Paperclip, a challenger marketplace taking on eBay. Rich shares lessons from his fundraising in #BehindTheRaise: What’s the biggest thing he thinks investors look for? What would he do differently if he did it all again? And well, does AIN really work?

Tell us about what got you into start ups:

I’ve always had an entrepreneurial mindset – my first business was at school selling Big Red chewing gum that I imported from the US, it certainly made me more money than my paper round!

At university, my housemate, Alan, (later, co-founder) and I made good money importing clothes from the US and selling them on eBay, and we saw an opportunity there for a challenger marketplace to take on eBay’s monopoly. We shelved the idea at the time, and both went into our respective management consulting careers – but eventually I thought that if I didn’t do something entrepreneurial soon, I might never, so I took a career break and started attending startup events in London like AngelHack and London Startup Weekend. I pitched Paperclip, we came second place, and we got to work.

Why did you decide to raise investment?

Being a marketplace, we realized that we’d need to go for a few years without any discernible revenue, and so we sought investment to fund the runway. Not only this, but we wanted to get a strong network of investors onboard that could add value on the journey – introductions for commercial partnerships and to other investors, and so on.

Marketplaces are always tricky, and it can take a while until the critical mass of buyers and sellers and unit economics start to take shape. However, when they do get it right, they have the power to influence people’s everyday lives – which is something that excites me a lot. Platforms like Amazon, JustEat, Uber, Deliveroo, and Depop are a testament to that – they provide value to millions of people, and have made massive returns for their investors, but they were cash hungry at the start and required significant investment to get to that scale – we are no different in that regard.

What is your top tip for anyone raising investment for the first time?

It’s always tricky at the start.  Your personal network can help a lot at that time – my first investors were a friend from university, a family friend, and my old boss! But other than that, seek investors that add value in the right areas -speak with founders that have exited similar or complementary types of businesses.

Any government support such as grants can help a lot to get momentum going, and speaking to pre-seed funds that can match fund will help things significantly: if you have an offer on the table for match-funding (e.g if you raise £100k then the fund will match that with £100k), then it helps things along significantly.

I’d suggest not being too inflexible on your valuation, but be wary of adapting your investment terms to something you’re not comfortable with, such as giving away too much control or appointing directors that don’t share your vision, or that might become an issue later down the line. The right kind of investors can make your journey far smoother, the wrong type can make it hell.

What attracted investors to your company?

I think investors like the concept of what we’re trying to solve and the novel way that we are approaching it – it helps that the secondhand goods market is massive and also set to expand 500% over the next 5 years – and so the potential is huge. However, at the start, investors are mostly investing in the actual team – and having a strong team really helped with that.

We were fortunate enough to get some high profile investors onboard at seed stage, such as  David Buttress,  co-founder and former CEO of JustEat and Hayley Parsons, the founder and former CEO of GoCompare. Most people in the UK would have either seen or used their platforms, and so it added some credibility to our cause.

Rich Wooley, CEO, Paperclip


My biggest fundraising mistake was…

Probably the biggest fundraising mistake I made was not pushing back on some of the investment agreement terms in our first VC raise. There are a bunch of reporting, corporate governance and approval processes that I have to go through. For example, I need to gain approval for spending over £5,000 on something, or hiring someone with a salary of over £35,000. 

These terms ultimately do benefit and protect our shareholders, so they’re not all bad – but for the stage we’re at, they can be slightly onerous; they  can slow things down at times or take me valuable time to report.

Why did you choose to use Angel Investment Network?

Over the years, I had heard of Angel Investment Network, but I never wanted to pay for it!  Then one day at the Natwest Accelerator, two of the founders I was mentoring came over and told me they’d raised over £250k each on the platform, and so I signed up right away.

I’ve also tried other platforms, both UK and US focused, and have never had the same level of success on them. It’s clear to me that Angel Investment Network has the largest and most active pool of angel investors in the UK – perhaps in the world; I’ve met some incredible people and received investment from all over the world; Australia, Hong Kong, Singapore, South Africa – the list goes on.

What has the funding enabled?

Investment has made a huge difference to the talent we have brought onboard, and the build phase that we’re in. Some of our investors have made valuable introductions, and so it has had a massive impact on our business. Going forwards, I can see that the investor base that we have will be able to provide us even more value as we grow.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

Four benefits of backing more diverse startup founders

The worldwide startup ecosystem is well established and growing strongly in many different territories. The success of Angel Investment Network in creating more connections between founders and investors globally is testament to that. However, while investment in startups has rebounded strongly after the worst of the pandemic, we can also follow this with an increase in funding for diverse startup founders. Why does this matter? Well, it’s not just about having better representation for the sake of it, important though this is, it actually also makes better sense commercially.

In the UK while just 5% of founding teams have two female founders, research has also shown that only 1% of venture-funded startups have black founders. It’s a similar picture in the USA, where according to Crunchbase, black startup entrepreneurs still received only a tiny fraction — 1.2 percent — of the $147 billion in venture capital invested in U.S. startups through the first half of the year.  To disrupt this, here are four reasons why we need to boost investment into more diverse founders.

  1. It can lead to new business opportunities
    Many diverse business startups can offer products targeting diverse consumers uncatered for currently in the market. However, if the investors themselves are not more diverse, they may not have the same understanding of the market to know where the opportunities are. This is a challenge many female founders also face. For example, we can purchase most groceries online except ethnic food – which you still have to visit your local market, small grocer or if you’re lucky, there will be a small selection in the supermarket however, it’s unlikely you can order online. As this is a minority need many would struggle to get backing from a British bank however, Mariam Jimoh founded Oja, developed an app that delivers ethnic produce from local groceries to customers’ doorsteps. After much hard work, she was successful in finding funding. As one of only a handful of success stories here, we know there are many other missed opportunities to serve a potential market of many millions.
  1.  New markets can develop and thrive
    New markets thrive on having dynamic businesses and competition. However if certain businesses are unable to grow, their products or services remain in need and the circulation of money in the economy then shrinks. We can create opportunities to serve different markets, have more alternative viewpoints in the business decision and drive forward education and revenue based around new business variations which cater for wider groups. Let’s also remember these are emerging and growing markets too, so there are fantastic opportunities for investors with the right foresight.    
  1. More diverse teams do better
    Just as in nature, having diversity is key to the health of ecosystems, the same applies to diverse teams in startups and wider existing businesses. Research has shown that companies with diverse management teams are more innovative and have 19% higher revenue. In many of the fastest growing sectors such as tech, this growth is key to success. So diversity is not just about a tick box activity, it’s about the make up of high performing teams, who are going to positively impact the bottom line. The reverse is also true. The more we can represent the whole of the country and their different needs, the better solutions we can develop and ensure new markets can flourish
  1. Backing more diverse founders across the globe can help tackle some of our greatest challenges
    Of course while it is important to look at backing more diverse founders at home, we also need to look at more diversity in funding globally. So much capital is concentrated on a few established, wealthy hubs. However, having more underrepresented founders across the globe we can also potentially have new insights and ideas for tackling many of mankind’s most pressing problems. People on the ground in countries most impacted by climate change may well have some more untapped and innovative solutions, but often they need the contacts and capital to turn their idea into reality. By looking at ways we can boost nascent startup ecosystems in developing countries, we will be in a better place to address many of the problems threatening the planet with sustainability based solutions which could become hugely profitable.

So where to start? The first thing we need to do is look at how we can support micro-enterprises. They are on the very first rung of the startup ladder and the more of these we can support, the more chance of startups on a pathway to Series A and even Unicorn status can emerge. This is why Ace Entrepreneurs has created our first micro funding program for the diverse community. While we have seen a huge democratisation of startup funding in the past few years, we now need to complete the journey and make sure a truly diverse startup ecosystem can flourish.

By Nadine Campbell, entrepreneur and founder of Ace Entrepreneurs. The ACE Entrepreneurs Investment Program has been launched to tackle a funding gap for black-owned businesses. 

#StartUpBuzz

Here’s our pick of companies raising investment on Angel Investment Network at the moment. 

From launching podcasts, to helping you select the most appropriate emobility solution, or a modular sofa that will actually fit through the front door, these are the startups that are solving meaningful problems with capable teams, and a clear route to market. 

Auddy 

Whilst starting a podcast may seem deceptively easy, actually launching it successfully, building a user base, maintaining growth and monetising it, are a lot easier said than done. That’s where Auddy comes into help. 

Auddy is one of the UK’s leading podcast publishers. Using cutting-edge data and analytics, they make the business of podcasts hassle-free. They work with top creators to produce and market premium shows before distributing them to all major platforms. They then provide advertising and sponsorship sales, paying properly meaningful royalties back to the creators.

Controlling the end-to-end process means they can also produce private shows for corporate’s internal employees or leading branded content for a company’s content strategy. These are high margin jobs and provide a diversified revenue stream beyond pure consumer publishing.

Key Facts

Founder has numerous IPOs and exits, including for Virgin

B2B clients including Vodafone and Open University 

Acquired leading UK branded podcast publisher – Radio Wolfgang

‘Auddy has an incredible team behind it, driving a sophisticated business model in what is a rapidly expanding market space. We were hooked from the off and we think it’s an exciting opportunity for the network!’ – Sam Louis 

Find out more about Auddy here.

Electric Rider


In big cities, suddenly electric mobility solutions are appearing everywhere. Electric Rider is an online marketplace selling emobility solutions from ebikes to escooters, even electric unicycles. 

The trend for the electric revolution appears to be getting strong momentum, buoyed in part by London and other major cities introducing low emission zones.

Electric Rider makes it easy to find the most appropriate electric mobility solution for the user – with a ‘help me choose’ solution finder, as well as flexible payment options. 

Key Facts

The emobility market is forecast to grow at 20% year on year

Electric Rider achieved £1million gross revenue with 30% margin in first 18 months

Over 55 brands in stock and growing

‘Impossible to ignore what they have achieved in such a short space of time. Along with the current move towards electric transportation in cities it was a company that I really wanted to help raise.’ – Xavier Ballester

Find out more about Electric Rider here.

Cozmo

Ever ordered a sofa with a long lead time only to find it didn’t fit through the door? Or pulled a muscle in your back trying to lug a sofa up the stairs? Cozmo is a new type of sofa company, reinventing what sofa purchasing should look like – modular and delivered in a box. It’s also a sustainable solution, allowing easy changes to both configuration and also its design with changeable top covers.  

Key Facts

The emobility market is forecast to grow at 20% year on year

Electric Rider achieved £1million gross revenue with 30% margin in first 18 months

Over 55 brands in stock and growing

Find out more about Cozmo here.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

Tips from the top: Raising investment

In our recent survey of startups in the UK and USA raising investment was raised as the number one challenge they faced, emerging from the pandemic. In the first of our new series of expert advice articles, David Pattison, experienced angel investor and leading media agency PHD founder, gives his top tips for those raising investment for the first time.

I have spent a lot of time chairing/advising young businesses and founders on how to approach fundraising. I always advice my clients to get involved with CNAPP security, as it is one of the most trending and useful security tactics.

It has always struck me that, at the very point when young businesses and their founders are looking for funding, you are at your most inexperienced and vulnerable. You are often in a negotiation dealing with very experienced deal makers. This negotiation is often pivotal to the future of your business. One bad clause signed up to in an early negotiation can magnify in size as time and fundraising rounds go on.

What can you do to try and even up the negotiation?

Before you start remember these three things:Investors only care about one thing and that is their money. In the case of Venture Capital and Private Equity that is how they are measured. They have clients who fund their funds and financial success is how they are judged and how they can then raise more funds. They want you to make money for them. For stock market API, you can check it out here!

Raising money is hard. Right now there is a lot of money in the investment market, but you have to have a good business and a really strong offering to raise money. Young businesses seem to be lulled into believing there is a money tree at the bottom of the garden that just needs a shake. There really isn’t.

Raising money is really distracting. It takes focus away from the business and most companies suffer a slight drop in performance through this process. Just at the point where it’s not wanted. Share the load around and take advice from trusted sources.

Once you have got your head around that, what else can you do before and during the process?

Here are five of the many things you should do:

1. BE THE BEST BUSINESS YOU CAN BE

It sounds obvious I know, but investors are looking harder and deeper into prospective investments. You will need to present yourselves as the best business you can be. Showing that you understand all aspects of your company and your markets.

You need to be a well balanced and appropriately experienced team with a shared view of the future. Have a proof of concept (does it work?), ideally some revenue (is someone prepared to buy it?) and will they buy it more than once. A good understanding of the competitive set. If appropriate some IP protections. Most importantly that you are in control of the finances of the business and have good quality finance resource.

If some of these points describe your business, then you are well prepared for the questions the prospective investor will expect you to answer.

2. do not get close to running out of money

Never leave it too late to raise funds. Investors will sense if you are running out of money and will try and delay the completion so that they can ‘chip’ the deal just before closure.

Leave yourself plenty of time. Never underestimate how long it takes to raise money, allow 6-9 months if you are looking for serious money. Try to give yourselves options. Taking money from the least worst option is never good.

3. RUN YOUR BUSINESS AS IF YOU ARE ALWAYS ABOUT TO ENTER DUE DILIGENCE

Prepare, prepare, prepare. It sounds obvious but make sure you know your business and your market better than anyone. Do not take fundraising lightly. In the digital age it is easy to set up a data room that has all the company data in one place. Have good governance in place. Get the financials and the legals in order. Remember that DD is not a one-way street when you are raising funds then check out the potential investors.

4. be clear on what you want to achieve

This works in two ways. Firstly, be clear amongst the team on what you want for the business moving forward. Are you all aligned on the future strategy and exit points? Mixed messages to investors don’t travel well.

Secondly, when the time comes to raise the money be very clear to the investors what the money is for and what success looks like. Not many investors want to fund cash shortfalls and saving the business, and if they do it usually comes at a massive cost to you. They are called investors for a reason.

5. beware of deal fatigue

When you are in the fundraising process be aware of deal fatigue. Investors, and particularly the institutional investors rely on you running out of steam. If your chosen investor is a significant shareholder, they will be a big part of your business life. You don’t have to love them but make sure you respect them and their motives.

Very often management get to a stage in the process where they just want it done. They agree to a deal without looking at every last detail. This is where investors can add the hidden clauses that bite you in the future. Stay attentive and on the way through make sure you share out the workload amongst the team.

One final piece of advice. Everyone I speak to who is involved in fundraising says the same thing, ‘get the best lawyer you can afford’. Don’t be afraid to upgrade as you go through the investment stages. A good lawyer should be seen as an investment and not a cost. They will also do a lot of the legwork on the legal documents for you and keep you focussed and avoid a lot of the pitfalls.

As I said right at the start of this, fundraising is not easy, and you should take all the constructive help you can find. I have been involved in a lot of fundraising.

If this blog has been of any help, then you might be interested in reading my book: The Money Train: 10 Things young businesses need to know about investors. It’s a guide to preparing for the investment process from seed capital to Series A, with lots of real-world examples. Whatever route you take to raise funds I wish you good luck and success.

David Pattison has had a long and illustrious career in the advertising industry and as an angel investor. He co-founded PHD in 1990 and more recently he has been involved in a number of startups in a range of industries including, marketing, publishing, construction, motorsport, AdTech, MarTech, FinTech, production and broadcasting. He was recently announced chairman of Conversational media platform Octaive.

#SixtySecondStartUp with Cancha

For this edition of #SixtySecondStartUp we have Jack Oswald, founder of Cancha, he shares how his experience as a professional tennis player led him to set up Cancha – unique tennis bags designed from the ground up:

  1. What does your company do?

Cancha is a customizable sports and travel bag brand. Our bags feature a unique modular design, which allows different accessories to be mounted and detached from each other in a matter of seconds, allowing users to tailor their bag to their favourite activities and daily routine

Cancha Bags are also made from an abrasion-resistant, high-tenacity nylon, and incorporate the latest advancements in textile manufacturing processes, such as laser-cut fabrics, heat-bonded zips and RF Welded construction. Cancha launched during the pandemic of 2020, and has since seen a strong uptake among sporting and outdoor enthusiasts looking for an innovative and durable way to travel with their gear.

Jack Oswald - Cancha
Jack Oswald, Founder of Cancha
  1. Why did you set up this company?

    As a professional tennis player traveling around the world for over a decade on the circuit, I became frustrated with the tennis and travel bags out there for sport and active-minded people. I saw the need for a better tennis bag; One that could adapt for the next trip or activity and durable enough to keep up with an active, travel-hungry lifestyle. 

However, I soon became aware of the wider demand for durable, highly customizable sports bags that could adapt to each individual’s daily routines.  So I teamed up with my friend, who is a world-class soft goods designer, to develop a modular system that would allow a backpack, tennis bag, wet-dry clothes bag and shoulder travel bag (our first range of products) to attach and detach with relative ease. 

This took much longer to develop than originally planned – our 6-month schedule starting in early 2018 ended up taking almost 3 years! We refined and refined the designs, tested them among top tennis players, travelers and anyone who would be willing to try the bags out. We went through over 50 prototypes, all painstakingly built by hand in our small workshop. Eventually, after countless hiccups along the way, we were confident that our bags were ready for the wide world. 

  1. How did you get your first customer? 

I remember very clearly; It was in November of last year. The first batch of bags had landed in the UK and we had just launched the site. A lovely lady in London was our first customer, who bought a bundle of the Backpack and the Wet-Dry Bag attachment. I couldn’t believe my eyes when the order confirmation appeared in my inbox. I think we have never packaged up an order so carefully!

However, the hunger for more sales very quickly grows, and the desire to improve the customer experience starts to becom a bit of an obsession – whether that’s improving our website and social media touchpoints, responding fast enough to customer queries and, of course, continually finding ways to innovate the products themselves!

  1. We knew we were onto something when? 

The first few sales are always a bit of a novelty, but when the consistency of sales kicks in, that’s when you start to believe you have got something. Retailers actually wanting to stock the bags was also a huge confidence booster for us. I remember sending out samples to stores and just being petrified that they would hate the design, or that they would simply say that they didn’t believe there was a market for our products. When we started to get into some stores and have their validity and backing behind our products, things really started to kick off for us. 

  1. Our business model: 

Our bags are currently manufactured in Asia and then shipped off to the UK from there, where we fulfil our orders internationally. We make a large part of our revenue through ecommerce sales on our online store, but partnering with both online and brick-and-mortar retailers has given us the stability to grow.. 

  1. Our most effective marketing channel has been: 

Media outreach. With eCommerce being a big part of our business, we have to mix a wide range of marketing channels into our strategy. However, being able to spread the word on the Story behind them brand, my background as a tennis player and the need we are filling, we have really been able to connect with our customers. I often get customers emailing after their order saying they heard me on some such podcast and the story alone swayed them to buy our products. It’s one of the most overjoying moments when you hear from people all over the world that they identify with our background, our mission and reason for being. This is why media outreach has been so successful for us, as it has allowed both Cancha and myself, as the founder, to get our message across in a sincere and personal way.

  1. The biggest mistake that I’ve made is:

Committing too early (financially and mentally) to a project. We launched our crowdfunding campaign in December of 2019, when our product wasn’t near enough to a  production-ready stage. My own desire to get Cancha’s offering out there made us rush our marketing strategy and meant that backers of our campaign had to wait substantially longer than forecast to receive their Cancha Bags. This is something I think that founders tend to struggle with in general; their passion, desire and determination to achieve their goals sometimes overtakes their company’s progress. While this characteristics is extremely useful, (crucial in fact), sometimes it can cause a company to pull the gun too soon, when it would have been more beneficial to build strength a little longer. 

  1. We think that there’s growth in this sector because:

Times are changing, and we’re changing with the times. Cancha is not just about designing innovative and sustainable soft a products for consumers. We’re also committed to creating a sustainable and highly technical manufacturing service for western athleisure brands. The reality is that shipping products 3,000+ miles from outsourced production or assembly sites in lower cost nations has been the go-to strategy for western brands for some time now. However, we are seeing a substantial shift in the business environment, both among customers and brands for closer proximity of manufacturing and more responsive business models. We want to be a leader in driving this trend, providing more responsible methods to drive innovation and customer experience in the textiles and soft goods industry. 

  1. We worked with AIN because:

We’re looking to bring some forward thinking, ambitious individuals into the project. We’re looking not just additional capital, but also for expertise in retail and production to help propel Cancha in this direction. AIN’s comprehensive network of investors across a wide range of backgrounds and industries made them the obvious choice to share our project.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

Angel investment Network announces launch of Institutional investment arm, AIV Capital

Ethan Khatri

London-based Angel Investment Network, the world’s largest online angel investment platform, has announced the launch of its Private Equity and Venture Capital division, AIV Capital.

Led by experienced investment manager Ethan Khatri, AIV Capital will invest between $10 -$75Mn+ into established businesses ranging from Growth/Series B to pre-IPO and has a flexible approach utilising both primary and secondary capital. Its sector agnostic focus will be on strong management teams with a demonstrated edge in the space they operate in. 

AIV Capital Managing Director, Ethan Khatri brings 16 years of investment experience across the European and Asian venture markets. Over the course of his career, he has successfully completed 27 transactions achieving 13 exits, covering technology, enterprise software, pharmaceuticals, healthcare and consumer. He will be combining his experience with AIN’s early stage market coverage and portfolio of businesses they’ve historically funded. 16 year old AIN has a global network of more than a million entrepreneurs and more than 280,000 investors, winning investment for a host of powerful businesses including What3Words, Simba Sleep and SuperAwesome. 

According to Mike Lebus, founder of Angel Investment Network: “AIV Capital is the natural next stage of AIN’s evolution. AIN has been a game changer in democratising access to angel investment and powering the dreams of so many startup founders on the first stage of their fundraising journey. With the right experience and team in place, led by Ethan, we are now able to support businesses right through the fundraising cycle, from the idea in a bedroom to seed funding right through to pre-IPO.” 

According to Ethan Khatri: “AIV Capital is a powerful new force in private equity and venture capital. Building on the evergreen network of AIN, our experienced team has access to an extraordinary talent pool of growth to late stage businesses which we can match with the right funding structure to ensure they deliver absolute return opportunities. Our watchword is flexibility. We invest across the capital structure and this is the method by which we maximize returns for all stakeholders.” 

Ends

Behind The Raise with Tooth

How often do you replace your toothbrush? Have you ever considered where it ends up or the environmental impact? Tooth is a subscription toothbrush service, looking to reduce waste. We caught up with cofounders Joshua Oates and Kiana Guyon to learn about their recent investment round.

Tell us about Tooth and how you came up with the idea

Over 7 years ago now an idea was born that still holds true today. ‘What if we made a toothbrush where you just change the head, like a razor blade and you keep the handle forever.?’ Out of this question Tooth was born.

The oral care industry is inherently very wasteful and has remained relatively unchanged for over 100 years. We’re here to change the norm and disrupt the market with simple product enhancements, design and smart materials. 

Tooth: the reusable toothbrush

Why did you decide to raise investment?

Like any startup, capital is needed to develop and grow the product and business. Physical products are capital heavy as it takes time to prototype, tool and manufacture the products. Having other minds on the project can lend some help and open up some pretty interesting doors moving forward. 

What is your top tip for anyone raising investment for the first time?

People invest in people.’ No one wants to invest in someone who is passionless, desperate and difficult. Sell yourself, sell the company, sell the product. You do it in that order you will raise funds. 

What attracted investors to your company?

Having a clear vision, product timeline and strong core team all played a part in closing deals across our round. 

The Tooth subscription box

My biggest fundraising mistake was…

Taking money from anyone. Make sure you actually get along and the collective vision is there. Be picky. This creates demand. You then supply that demand.

Why did you choose to use Angel Investment Network?

It provides a cost effective platform to get the project out into the ecosphere. The large network allows you to see if your idea is interesting or not to angel investors. 

Our number 1 focus for Eco Tooth for the year ahead is:
Proving our KPI’s (key performance indicators) is super important this year. Making sure we can hit our predicted acquisition costs, attrition rates etc will allow us to raise the next round of funding.

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

Majority of US startups very optimistic about the next 12 months

A majority of US startups (52%) are now ‘very optimistic’ about the next 12 months, despite 62% seeing business growth negatively impacted by the pandemic. This was a key finding of a new study of US startup sentiment 18 months after the start of the pandemic, by Angel Investment Network (AIN). The study of 1,205 US based startups found 76% expressed optimism overall with 19% quite optimistic and 52% very optimistic, versus just 24% who were pessimistic. It followed on from a similar survey we conducted of UK startup sentiment last month.

The results show the extent to which confidence has returned to early stage businesses Stateside, who are emerging strongly from the downturn. Of the 62% of respondents who revealed they had been negatively impacted by COVID, 37% had been ‘very negatively impacted’. Meanwhile 63% of those who had been planning to raise funds said they had delayed a raise as a result of COVID.

Top strategies to mitigate the impact of stalled fundraising were: Focusing more on networking, favoured by 46% of respondents, holding off launch plans (38%) and bootstrapping instead (32%), with a similar number delaying marketing.

Entrepreneurs were also asked what their biggest challenges were going forward. The top result given was raising investment (84%), hiring/recruiting the right talent (22%) and product development (22%). Ongoing COVID issues were a problem for 13% of those polled. 

US startups also believe more Government action is needed to encourage investment and help startups flourish. 57% favour making tax relief more generous to boost angel investment, 32% making R&D tax relief more generous and 22% lowering corporation tax. 70% of respondents are confident the US will retain its place as a startup hub.

AIN has seen surging growth on its platform with connections between entrepreneurs and investors up by 23% since the start of the year. Meanwhile revenues have increased by 40% to a new record, indicating the huge pent up demand from startups now seeking funding. 

According to Mike Lebus, founder of AIN: “It is encouraging to see how US startups have shown their mettle to ride out this really difficult period and emerge battle tested and with high levels of confidence. Many have been negatively impacted but have used their time wisely to build up their pipeline of contacts and bootstrap their businesses as far as they can go. RaIsing investment remains the biggest challenge going forward and as the world’s largest angel investment platform, we have been encouraged by seeing a record number of connections between investors and startups.” 

How did you respond to the pandemic?

  1. Focused more on networking: 46%
  2. Held Off launch plans: 38%
  3. Bootstrapped instead: 32%
  4. Delayed marketing: 32%
  5. Held off making hires: 27%
  6. Had to let staff go: 20%
  7. Relied on business loan: 19%
  8. Pulled back from R&D: 12%

What could the Government do to help?

  1. Make tax relief more generous to boost angel investment: 57%
  2. Make R&D tax relief more generous: 32%
  3. Lower corporation tax: 22%
  4. Offer more clarity on COVID restrictions: 14%
  5. Make it easier to provide VISAs for recruiting the right talent: 13%

What are your biggest challenges going forward?

  1. Raising investment: 84%
  2. Hiring/recruiting the right talent: 22%
  3. Product development: 22%
  4. Ongoing COVID issues: 13%
  5. Consumer sentiment: 12%

Behind The Raise with Porter

Gary Piazzon founded Porter after becoming frustrated finding a suitable hotel. He shares some of his key learnings from fundraising and his biggest mistake in this edition of #BehindTheRaise.

Tell us about Porter and how you came up with the idea

It was a nightmare, timely and stressful booking experience that led me to the idea of Porter; I visited one of the large online travel agents, entered my search criteria and was hit with a pretty intimidating 2,000+ results.

I wrongly assumed the hotels near the top of the list would be a great match for me. They were nowhere near where I wanted to stay and only appeared higher up as they were clearly paying a higher rate of commission.

That got me thinking, why see the results you’re not interested in?

Porter is designed to make booking a hotel simple and fun by learning about the elements that matter to users so it can assess the thousands of potential property options to help recommend the right places to stay.

In a nutshell, Porter simplifies hotel booking, by only recommending your best matches. 

Why did you decide to raise investment?

Raising investment was pretty much a necessity to really get things off the ground.

As we’re building a very technical platform leveraging various levels of machine learning and artificial intelligence, we needed to ensure we could attract the right talent, as well as pay the bills for hosting etc. so raising investment was really important from that perspective.

Beyond the technical aspects, it’s also been crucial in helping us raise some initial awareness of the site, and further we purposely targeted ‘smart money’ and ended up with a collection of very experienced, knowledgeable investors, all of whom have contributed advice, support and knowledge to the business. 

What is your top tip for anyone raising investment for the first time?

My top tip would be to ensure you have a clear story, and think about the traction you can show to demonstrate interest.

From a story point of view, I think it’s really important that when investors look at your pitch, or speak to you, they come away with a really clear understanding of what you’re trying to do, why you’re doing it, and how you’ll do it better than anyone else.

You should then be able to support this with some sort of traction that demonstrates people being interested. This could be in the form of users signing up to your pre-launch page, user engagement on your MVP, revenue numbers etc. 

What attracted investors to your company?

I’d say there were a few key things:

·        All of our investors resonated with the problem we’re trying to solve. They’d all experienced the frustration and wasted time of endlessly searching for the right place to stay when going on holiday. This immediately put us in a good position when discussing the business.

·        Secondly they recognised that there’s an enormous opportunity to go after, and the market has proven itself capable of supporting numerous large players. Globally, the online travel agent market is worth c£440bn, but in the UK alone, the market is worth around £35bn. That means, even if we were to capture 1% of the market, we’d be achieving £350m of revenue.

·        The final thing that attracted investors to our company was our strong founding team, and the interest we’d demonstrated through our pre-launch page. We built an initial team with experience spanning Development, UX, Product and Marketing and built a pre-launch waitlist of over 3,000 users. The combination of these two points gave our investors the confidence that we were the right team to try and tackle the problem. 

My biggest fundraising mistake was…

Initially failing to adapt pitches and conversations for my audience. I quickly learnt that different types of investors were looking for different information from our discussions, with a big difference between angels who were much more interested in the vision and team, versus VCs who were much more focused on the quantitative side of things. 

Why did you choose to use Angel Investment Network?

I was actually recommended to AIN from a fellow founder who has previously raised a number of rounds through the platform.

AIN was a no-brainer thanks to its ability to connect us with such a large number of investors. Not only did using AIN help us successfully close our pre-seed round, but it also helped us meet some really interesting industry experts.  

What is the main focus for Porter for the year ahead?

We’ve actually recently started raising our next round of funding to allow us to accelerate product development, grow our team and reach more people.

This is a really exciting time for Porter. As travel restrictions start to ease, we’re already starting to see an uplift in people wanting to travel. Our focus now is ensuring we’re best placed to help as many users as possible discover and book their best matched trips. 

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

#BehindTheRaise with SidebySide

It’s not actually exclusively startups that raise on AIN, there’s a growing number of funds too. We caught up with James D’Mello from EIS Fund SideBySide to hear about their experience:

Who are SidebySide?

SidebySide is run by a management team responsible for over $1.5bn in exits to date. We have worked with younger companies for a number of years and concentrate on adding benefit to help these companies scale from startups to larger, growth businesses. 

The UK management team is formed of our founder, John Bailye. Our Junior partner, Ben Ashworth. Our Portfolio Manager, Alicia Taylor, our portfolio company mentor, Sheli Gupta, and James D’Mello, who heads up our investor relations function.

John Bailey, Founder

Our investment thesis

Although we score third globally in an OECD ranking of the number of start-ups created, we don’t make it into the top ten when it comes to businesses that grow into established, medium-sized companies that have a lasting impact on our economy” – The Independent, referring to the UK in the OECD Global Rankings 2017.

This is our focus and why we formed the SidebySide Partnership. We want to help founders take their business to the next level.

James D’Mello

What types of companies do you invest in?

We invest in fast-growing technology-enabled businesses with £1-10 million in revenue. These more established companies will usually be at least several years old and typically have over 30 employees. We look for companies where there is evidence of a strong customer acceptance of the product and service offered, and where we believe we can add value to them in the long run.

Tell us about your portfolio

We invest in “tech-enabled” companies. That translates to companies who use tech to change the way we do something by a company that is looking to define the way future companies in their sector will operate. 

As an example from our most recent round. We invested in a company called Laundryheap.

Laundryheap offers door-to-door laundry and dry-cleaning services to consumer and business customers, including major brands. The platform allows users to have their laundry collected, washed, ironed, and returned to them in a guaranteed turnaround time of 24 hours.

One of the main reasons we love them is the fact that they are able to scale into new markets without the capital heavy constraints that have held back their competitors. Across its US and Asian markets, Laundryheap has seen particularly rapid growth since March 2020. In the US, where the platform is now operational in multiple cities, the business is reporting month-on-month growth between 50 to 100 per cent. As for the Middle East, where, customer growth is hitting between 60 to 80 per cent month-on-month.

What is it like raising investment as a fund? How is it different from raising for a single company?

Raising as a fund is very similar to raising as a single company, except, instead of talking about one company, we talk about many. Typically investing in 3-5 companies per round, there is a lot to talk about. We pride ourselves on the amount of time we spend with our companies each month, therefore can go into as much detail as a potential investor wants to go into.

What are your tips for raising on AIN?

Our first campaign with AIN received a lot of interest but the interest didn’t lead anywhere. We took things back to think about what we could do differently, One of the main things we changed was the points that we highlighted, less of the traditional X amount of revenue, aum etc – more of what made us different to other investment funds they may have seen. We were very upfront and frank with potential investors and made sure to schedule zoom/phone calls after speaking on AIN to allow them to meet us and ask their questions in a more conversational manner.

What are your plans for the funds? How are you deploying them?

We have invested in 6 different companies now over our last few deployments, in our most recent round we invested into a fashion marketplace that is changing the way retailers and brands sell their old season and discounted stock, a travel courier company that picks your bags/skis/golf clubs up and takes them to your holiday home/hotel for you so that you don’t have to worry about checking them all in and carrying them around.

How does SidebySide help startups? And what experience do you bring to the table?

Whilst a lot of UK VCs come from an investment banking/accountancy background, SidebySide is a team built from entrepreneurs and operator types. They have been responsible for founding, investing in and running over 30+ companies, one of which was founded and grown into a billion-dollar exit. The early mornings & late nights, the stress of running a company, the hurdles to overcome to scale your business, the team has been through all of it before, rather than just financed it and watched from the sidelines. We help the companies in our portfolio by spending time with them, a couple of times a month, going through whatever the company needs support on. 


Any tips about pitching investors over Zoom?


I used to love nothing more than speaking in a room full of people at pitch events/industry talks. When Covid hit, these events were all moved to Zoom, Which as I’m sure many of you will have experienced by now, Is a whole different ball game. It’s very hard to read peoples body language and facial expressions when there are 50+ people in a Zoom call, you also don’t know if anyone is laughing at your bad jokes if they’re all on mute! 

One of the main things I have tried to focus on and has seemed to work well so far is to try and concentrate on talking into the camera lens, it may seem like a small thing but it is the closest thing to eye contact you can do over Zoom. I also set out a couple of bullet points on my screen on a notes app to prompt me to go through set points on the call. 

Lastly, A great tip I read in a guide from Sequoia capital – One of the mistakes most people make is thinking because you have a 60-minute meeting slot that you have that persons attention for 60 minutes – Spoiler, You don’t. You should use the first 5 minutes to earn their attention for the next 15 minutes which in turn will interest them enough to listen for another 30 minutes.  


Where do you plan SideBySide to be in the next 10 years?

Unlike traditional VCs, SidebySide limits the number of companies that we invest in at any one time. We do this so that we can actually spend important time with each of them and make sure they have the best chance of success. So whilst most VCs would say in 5 years we want to have backed another 50+ companies – that is not us. We want to continue backing great management teams and working closely with them to help them scale their businesses to the next stage and become the type of company that defines the sector in which they operate. 

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.

#StartUp Buzz

Each month, we share a selection of stand out companies that our team have picked out as particularly exciting, or high potential. This month we have selected the following:

Immersify Education 

Immersify Education is a learning app, initially creating a totally novel experience for dentistry students, but ultimately a comprehensive solution that makes it much easier for students to learn across disciplines.

Immersify fast tracks the pace of learning by combining rich multimedia content and an AR experience that gives the students the sensation that they are working on a patient right in the dentist’s chair.

– The founder is an award winning edtech entrepreneur with an exit in the dental education space

– 100% recommendation for the B2B offering 

– Rated 5 Stars on the app store 

Immersify Education are raising £1.2 million and have SEIS and EIS relief available.  

Find out more about Immersify Education.


28 Well Hung 

28 Well Hung

28 Well Hung are pioneering the regenerative restaurant concept in London. 

All their food is chosen to help regenerate the planet, sequestering carbon and methane in the process and specifically working with farmers who are obsessed with regenerating the soil that they use. 

Starting out as a street food stall, 28 Well Hung is now an established restaurant with £230k revenue that was profitable during Covid. 

‘28’ are raising funding to expand, they have acquired a 9 year lease in Brixton and plan to open this summer, with a further London site due by the end of the year. Of note: 

– Strong vegan and vegetarian customer base (50% of menu is veggie)

– Nominated for multiple awards including Best Street Food Trader

– 16% operating profit in 2020

Find out more about 28 Well Hung Ltd


Scrubbingtons

Scrubbingtons produce a range of bespoke personal care products perfect for kids, from hand sanitiser and soap to shampoo and bubble bath. 

They use natural ingredients, perfect for sensitive skin, and make the product easy for kids to use themselves.

Why’s it special? It’s 98% natural, very soft, and has special foam that lasts twice as long as gel. It’s sustainable with refillable pouches and recycled. 

– 4.9* average across thousands of reviews 

– Already supplies 150 school and nurseries directly

– 400k revenue in 2020 with 200% Y-O-Y growth

Scrubbingtons products are widely available including in Tesco, Amazon and Ocado. 

Find out more about Scrubbingtons here.

Behind the Raise with Wealthyhood

Alex Christodoulakis is co-founder of Wealthyhood, the app ‘to turn you into your own wealth manager’.

Alex shares his story about Wealthyhood, how he raised investment, and his advice for entrepreneurs:

Tell us about Wealthyhood and how you came up with the idea

A few years ago, together with Kostas, co-founder of Wealthyhood, we wondered how we could invest our money on a monthly basis. We were busy professionals at the time and couldn’t devote much time to research or execute any sophisticated investment strategies, and of course not in the position to actively trade the markets.

So, we spent time trying to identify what was out there to solve this problem. However, we soon realised we weren’t alone in that. The problem was everywhere around us. There was a typical question among our friends, family and colleagues: “How can I invest my money? I don’t have the time or the knowledge to trade…”.

But how will they do that? 

Trading apps are usually too complex for beginner investors. They offer no guidance on how to get started or tools to create a long-term portfolio. They incentivise you to actively trade, by constantly notifying you for random price movements. Everyday investors get caught up on their emotions and end up gambling instead of investing. This was not the experience we were looking for.

So, we decided to build Wealthyhood to bridge the gap. Instead of just giving friendly advice to our friends, we decided to build a product that would guide long-term investors to build their wealth over time, by intelligently investing their money the way they want, with fewer fees.

It’s not only how our interactive guidance helps users to invest the right way, but also how we help them develop the right wealth-building mindset. You don’t have to be a millionaire nor an expert to have a successful and pleasant investing journey.

And this is how Wealthyhood was founded to become the first DIY wealth-building app for long-term investors.

Why did you decide to raise investment?

Unfortunately, Fintech is a very capital-intensive industry, even before you decide to spend aggressively on growth and marketing.

The initial costs have to do with securing regulatory approval and FCA compliance, even before you get started. And this is why we initially decided to raise some external money, alongside covering some operational costs and our plans to grow the team.

Apart from that, raising money from angel investors is a great way to validate your value proposition and showcase their belief in the vision of the company and the ability of the team to execute!

A successful angel raise doesn’t just get you money, but also access to the network and connections of your investors, so it’s a two-way process. The right investors can significantly accelerate our progress.

What is your top tip for anyone raising investment for the first time?

It’s always easier to approach angel investors, than early-stage VC funds. Start from your own network, pitch them your company and vision and then expand to your second degree connections, angel networks and of course the Angel Investment Network.

If you can’t persuade angel investors to invest in your company, then you should reconsider your pitch.

Always have a story to share; why you’re building this product, what’s the problem and why you’re the perfect team to  succeed!

Any signs of initial traction are a great validation that you’re heading to the right direction.

What attracted investors to your company?

I think it was a combination of different things. Probably the most important is the problem we solve. Our angel investors immediately acknowledged the gap between trading apps and robo advisors and the need for a DIY wealth building app for long-term investors.

Our vision to create the wealth-building app not for the top-1%, but for the 99% fully resonated with them.

At the same time, our investors had faith in the team behind Wealthyhood and us as co-founders. The first angel investors were people from our close network with strong  belief in our capabilities as a team. Then, friends of friends and finally professional angel investors, who got to know us better and believe in our determination and skills to execute.

Apart from that, we had already built some momentum, showcasing that we were heading in the right direction. We had more than 3,000 users signed up to our waiting list, over 10,000 followers in our LinkedIn and Instagram pages and had developed a community of 50 Wealthyhood Ambassadors across Europe.

Last, but not least, a few months ago we won 1st place on FinQuest Accelerator and are currently participating in the VISA Innovators Program, which for angel investors shows strong progress.

My biggest fundraising mistake was…

My biggest fundraising mistake was that we began by approaching early-stage VC funds, instead of angel investors.

This was wrong; it cost us time and money, but we soon realised it and switched our focus to angels, who were a much better fit for our stage and needs!

However, it helped us challenge our value proposition, improve our deck and positioning and make it more robust.

Why did you choose to use the Angel Investment Network?

Angel Investment Network was an amazing way to connect with the right investors for our company. It’s very time-efficient for founders and probably the best portal to share your story from a fundraising perspective.

It was first suggested by our advisors and we soon realised they were right to insist. 

Our number 1 focus for Wealthyhood for the year ahead is:

To build the investing experience we envision and make it publicly available through a web platform, iOS and Android apps. We’ve already launched a beta version of the product and are onboarding the first users from our waiting list.

Over the coming months we want to onboard the whole waiting list and give instant access to new users in the UK and EU!

Keen to hear more?

If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising fundraising yourself, you can find your local network here.

#Start-up Buzz

Each month on the Angel Investment Network blog we feature some of our start-ups making waves. Here are some of the ones to keep an eye out for in June:

Vitabeam

Vitabeam has developed a patented LED technology that mimics the sunlight spectrum to stimulate plant growth, extend shelf life of food and kill unwanted pathogens, such as bacteria and mould.

Vitabeam has £1.72 committed sales, a pipeline of £6.5 million, and has received 2 Innovate UK government grants valued at £640k. Tests have shown biomass increase in herbs as high as 54% from using Vitabeam.  You can click here to investigate on the best banking services available .

Learn More 

Mintago

Mintago helps businesses save on their workplace pension tax bill, whilst improving the ‘pension well being’ of their employees. Mintago helps businesses to structure their pension in the most efficient way using HMRC’s salary exchange scheme reducing NI contributions, whilst rolling out pension optimisation tools.

Founded by the founder of Perkbox, and with the team ex RBC, BDO and Atomico, Mintago is growing at 100% MoM and saved customers over £250k despite only launching in December 2021. 

Learn More

KiKaPay Digital Payments

KiKapay enables merchants to collect payments from customers in a manner that is typically 80% cheaper than card payments, by using their bank’s secure customer authentication process, and because it doesn’t require an app to be downloaded, KiKapay provides a frictionless solution. 

With open banking payments increasing ten fold in 2020 and 25 billion card transactions having been processed in the UK alone. KiKapay has brought onboard an experienced team with 75 years experience, including a partner at Deloitte and the ex Head of Advisory for European payments at EY.

Learn More