Connected Investing Manchester May 2019 Slides

May 17, 2019 | Publisher: Techcelerate Ventures | Category: Finance |  | Collection: Investments | Views: 39 | Likes: 1

MANCHESTER 16/05/2019 WELCOME FROM UKBAA RODERICK BEER Managing Director UKBAA # ConnectedInvesting @UKBAngels 3 4 WE ARE THE TRADE BODY FOR EARLY STAGE INVESTING 5 193 MEMBERS FROM ACROSS THE INDUSTRY W E L O O K A F T E R A N G E L G R O U P S Over 15,000 angels represented by these groups V C F U N D S From micro funds to major PE funds O N L I N E P L AT F O R M S And all the major crowd funding platforms A C C E L E R ATO RS Including incubators and universities A S S O C I AT E S Including government agencies, royal societies, corporates and intermediaries 72 28 14 30 49 6 CORE AIMS O U R W O R K C E N T R E S A R O U N D F O U R C O N N E C T I N G H e l p i n g o u r m e m b e r s d e v e l o p v a l u a b l e r e l a t i o n s h i p s R E P R E S E N T I N G C h a m p i o n i n g t h e v i e w s a n d i n t e r e s t s o f o u r i n d u s t r y P R O M O T I N G R a i s i n g a w a r e n e s s o f e a r l y - s t a g e i n v e s t i n g E D U C AT I N G S e t t i n g t h e i n d u s t r y s t a n d a r d o n b e s t p r a c t i c e T o b r i n g m e a n i n g f u l h e l p a n d s u p p o r t t o t h e e a r l y - s t a g e i n v e s t m e n t c o m m u n i t y 7 ANGEL E-LEARNING COURSE T h i s n a t i o n a l , i n d u s t r y - b a c k e d p r o g r a m m e b r i n g s t h e i n s i g h t s a n d e x p e r t i s e f r o m 2 2 e x p e r i e n c e d a n d l e a d i n g A n g e l i n v e s t o r s f r o m a c r o s s t h e U K . 8 OPERATE SIX ANGEL HUBS ACROSS THE UK W E A L S O W e ' r e r o l l i n g o u t o u r h u b s r i g h t a c r o s s t h e U K w i t h f i v e f u r t h e r h u b s p l a n n e d f o r 2 0 1 9 W W W. A N G E L H U B S .O R G 9 DEALSHARE PLATFORM T H E U K B A A H e l p i n g t o f o r m c o - i n v e s t m e n t r e l a t i o n s h i p s a r o u n d d e a l s i n a f r e e , o n l i n e e n v i r o n m e n t Share your deal with fellow investors to help build and close your round A D D D E A L S Search for deals by key criteria and reach out to discuss details B R O W S E D E A L S 10 INTRODUCTION FROM INNOVATE UK IAN CAMPBELL Executive Chair Innovate UK # ConnectedInvesting @UKBAngels New Innovation Finance Pilots Ian Campbell, Interim CEO, Innovate UK Connected Investing Manchester 16th May 2019 13 Challenge Led Industrial Strategy Challenge Fund Responsive Smart Grants Business Growth Pilots: Innovation Loans & Investment Accelerator Knowledge Transfer Partnerships Managed Programmes: Procurement, DMCS & CCAV, Late-stage (e.g APC) How do we fund? Innovation loans 14 For businesses on the edge of greatness We are running a pilot programme of loan competitions to the end of 2019. The programme is aiming to ensure that businesses can access funding at all stages of innovation. Up to 50 million available for business innovation projects near to market Offered through competitions to UK SMEs that want to scale up by developing new services Can be used for late-stage R&D projects not yet at the point of commercialization Delivered by Innovate UK Loans Ltd, a wholly-owned subsidiary of Innovate UK 15 Affordable, flexible and patient Single Applicant SMEs only Up to 100% of project costs Later stage R&D Loan size 100k to 1m Low interest rate 3.7% Flexible & patient Up to 10 years years 10 Innovation Loans 50m pilot programme 5 competitions completed 2 sector-based and 3 'open' 400 applications received, seeking 200m in loans 50m committed / 68 borrowers / 17.6m drawn Delivering innovation loans Delivering innovation loans 18 Investment accelerator The Industrial Strategy identified our investment accelerator model as a new approach to finance innovation, highlighting the potential for it to scale up. Investment accelerators bring together Innovate UK grant funding for innovative projects and VC and Angel equity investment in businesses to support growth through innovation. Investment Accelerator Model FAIL 100% FUNDED GRANT + EQUITY FAIL FAIL Meets Quality Below Quality Not Investable Investable Innovate UK Assessment Investor Due Diligence Applications Applications Innovate UK led: Working with multiple investors to increase investment capacity & activity in a specific sector Investor led: One investor lead using an Innovate UK grant 'sub-fund' to catalyse additional + follow-on funding within a strategic framework Closed IA competitions: Health & Life Sciences and Infrastructure Precision Medicine Open IA competitions: Plastics in the Ocean Audience of the Future Regional Angel Investment Accelerator Pilots 2019 Start-ups that access grant + equity funding do better But we need to make it easier outside London! Source: Beauhurst "Companies that have received both an Innovate UK grant and equity investment have a higher valuation on average than companies that have received only equity investment." Beauhurst Confirmed 3 pilots each with a 1m allocation Competitions are by invite only and follow engagement with one of the following: 1. Northern Angel Hub regional angel investment accelerator pilot broad coverage across the north 2. NE LEP Area Angel Accelerator Pilot run by Northstar Ventures and focused on the North East 3. The SETsquared R&D Scale-up Pilot run by University of Bath (SETsquared Partnership) with a focus on the South West, Wales and the West Midlands Estelle Blanks from the Innovation SuperNetwork will be covering this in detail at 4pm Find out more: https://www.gov.uk/government/organisations/innovate-uk https://www.ktn-uk.co.uk/ https://www.enterprise-europe.co.uk/ https://catapult.org.uk/ https://www.ukri.org/ Customer Support Service Email support@innovateuk.gov.uk Phone: 0300 321 4357 (Mon-Fri, 9am-5:30pm) LIGHTNING TALK: LATEST MARKET TRENDS HENRY WHORWOOD Head of Research and Consultancy Beauhurst # ConnectedInvesting @UKBAngels Beauhurst Investment in the North Connected Investing Manchester 16th May 2019 HENRY WHORWOOD @henrywhorwood Beauhurst Since 2011: 33,000+ equity investments 51bn of investment 2000+ exits tracked Context State of the market UK wide State of the market UK wide State of the market UK wide The North Investment since 2011 The North Top local areas since 2018 1. Manchester (121 deals) 2. Newcastle (46 deals) 3. Cheshire East (45 deals) 4. Liverpool (40 deals) 5. Durham (30 deals) The North Top investors since 2018 The North Top sectors since 2018 1. Fintech (21 deals) 2. Artificial intelligence (14 deals) 3. Big data (9 deals) 4. Insurtech (8 deals) The North Big investments in 2019 1. OakNorth (340m) 2. Wejo (19.3m) 3. Quick Reach (7.5m) 4. AccessPay (7m) 5. Mojo Mortgages (7m) Thank you HENRY WHORWOOD henry.whorwood@beauhurst.com www.beauhurst.com @henrywhorwood PANEL 1: THE FUNDING MIX MODERATOR JENNY TOOTH CEO UKBAA NICK EDGAR Senior Director Clydesdale Bank DAVID JOHNSON Head Of Business Development Manchester Ying De Group VOLKER HIRSCH Partner Amadeus DAVID SMITH Director Dow Schofield Watts CF # ConnectedInvesting @UKBAngels LIGHTNING TALK: HOW GRANT FUNDING DE-RISKS INVESTMENT CHARLOTTE THOMPSON Access to Funding and Finance Knowledge Transfer Network # ConnectedInvesting @UKBAngels How grant funding de-risks investment Charlotte Thompson, Access to Funding & Finance Photo by vincenzo di giorgi on Unsplash Grants Risk Stage of Development Fundamental research Feasibility studies Industrial research Experimental development Photo by "My Life Through A Lens" o Collaborative Photo by Jon Del Rivero on Unsplash Competitive Photo by Rita Morais on Unsplash Independently Assessed Achieving your Goals Having an effective plan in place Monitoring officer Risk register Commercial plan & milestones Photo by Sasha Stories on Unsplash Crystal ball Photo by Rita Morais on Unsplash Funding Body The ASK How much funding does the business need? What is the funding required for? What significant change will this funding have on the business? Charlotte.Thompson@ktn-uk.org Knowledge Transfer Manager, Access to Funding & Finance Use grants to de-risk your investment INTRODUCING THE REGIONAL ANGEL INVESTMENT ACCELERATOR ESTELLE BLANKS Executive Director Innovation Supernetwork # ConnectedInvesting @UKBAngels INNOVATE UK REGIONAL ANGEL INVESTMENT ACCELERATOR WHAT IS IT? HOW TO GET INVOLVED? Estelle Blanks, Executive Director, Innovation SuperNetwork Strategic Context Source: Innovate UK Rationale for regional programme The Angel Investment Partners (AIPs) 1m Northstar Ventures Northern Angel Hub SETsquared partnership Programme Objectives A pilot: develop, test and learn (May 2019 to April 2021) Increase the appetite and capacity for angel investment in regions Increase the scale up potential of innovative technology companies Increase diversity in investment The Northern Angel Hub: Angel Investment Partner (AIP) A significant collaboration of four organisations have come together to grow Angel Investment capacity in the north Our AIP has access to investors and innovative early stage tech businesses with the ambition and strategies needed to accelerate a growth in capacity. HQ: North East and Tees Valley, Sunderland (BIC and ISN) Hubs: Yorkshire and North West (North Invest) Reach: UKBAA and angel networks Our AIP has reach across the North and beyond Our investment focus is in early stage innovation and technology with particular focus on sectors with high growth potential in the north: Digital technologies Subsea, offshore and energy (clean growth) Advanced manufacturing & automotive Health & Life sciences (ageing) Fintech Technology for good, social impact Cyber security Immersive tech/media With a focus on high growth tech sectors To make between 10 and 15 direct investments in early stage technology companies Increase survival rates of supported companies linked to the combination of grant and equity support provided to companies. Increase the number and quality of relevant dealflow - c. 100 companies targeted by the pilot. Increase Angel investment capacity and activity in the north Increase diversity in both Angel investment and technology company leadership Our ambition Opportunity to derisk an investment opportunity by providing: Validation of the opportunity via independent assessment of the proposed R&D project Match funding 100% of the costs of that project with grant An opportunity to invest earlier or to allow a proposed investment to go further Natural catalyst to working with Innovate UK, other networks and the innovation community Development of a more natural funding package Opportunities for syndication and enable individual investors to consider a portfolio approach An opportunity to build local capacity of associated angel groups Benefits for investors Programme of active engagement with Angels/Angel Syndicates Use our Angel Hubs activities: Leeds and Newcastle Angel investors information, networking and training days Pitching events for investors Referral process through our project manager and dealflow manager: Jordan@supernetwork.org.uk UKBAA Dealshare Platform to allow investors to discover a curated pool of investment/grant ready projects UKBAA education and skills development programme How can Angel/Angel Syndicate get involved? How we're helping the Angels Discounted and free access to an 8-hour online course on Angel Investing. Angel training workshops and networking events. Free Access to co-working spaces across the UK, including London. 12 months free membership to the UKBAA. Lead angel identification and support: Personalised advice and guidance, including on forming and running a syndicate Introduction to co-funds and VCs Mentoring from experienced lead angels We plan to widen our highly successful diversity strategies to other minority groups and a wider geography. The Asian Business Network are keen to work with us Gender diversity events scheduled for 2019: 3 Women Angel of The North events 6 All Points North Women Founder and Investor events 8 Women Angels Drinks events Diversity is key to our values THANK YOU Estelle Blanks Executive Director 07752 752 880 Estelle@supernetwork.org.uk PANEL 2: EFFECTIVE INVESTING MODERATOR: TIM MILLS Managing Director Angel Cofund NIGEL GREENAWAY Founder Greenaway Scott PETER LUSTY Chief Executive Manchester Tech Trust ALEX ROTHWELL Investment Manager Maven Capital Partners JESSICA JACKSON Investment Director GC Angels, part of The Growth Company ELIZABETH GOOCH Founder&ceo The Tech Growth Factory # ConnectedInvesting @UKBAngels AN OVERVIEW OF THE 100M REGIONAL ANGELS PROGRAMME MARK BARRY Senior Investment Manager British Business Investments # ConnectedInvesting @UKBAngels www.bbinv.co.uk @britbusinv Regional Angels Programme British Business Investments Mark Barry 16 May 2019 www.bbinv.co.uk @britbusinv 68 Programme Overview BBI to invest up to 100m Make commitments to delivery partners who invest BBI capital Each commitment to be in the range of 5-15m BBI to co-invest alongside group of angels and other early stage investors Early stage equity finance throughout the UK Focus on regions which are underrepresented by early stage equity finance Aiming for a well diversified portfolio Invest via managed solutions, business angels, syndicates and platforms Timetable Launched Request for Proposals in October 2018 Rolling open programme www.bbinv.co.uk @britbusinv 69 Programme Objectives Increase aggregate amount of early stage investment Seek to increase the supply of early stage equity investment to small businesses throughout the UK, focused in regions that are currently underrepresented Promote angel investing across the UK Seek to raise the profile and professionalism of angel investment activity, and aim to attract further third-party private capital alongside angels Generate Commercial Returns BBI expects to make a return in-line with market from building a well diversified portfolio of investments www.bbinv.co.uk @britbusinv 70 Investment Criteria Target Market Growth businesses throughout the UK seeking equity finance of 100K 1.5M Investment Strategy Providing or facilitating early stage equity investment into growing UK businesses, with the ability to deploy a BBI commitment of 5-15M over a set number of years Management Team Experienced, credibility in early stage investing, presence in the UK market Origination Facilitate flow of deals, expected deployment, pipeline, diversification Commercial Returns Fully commercial rate of return, pre any tax incentives Private Investor Leverage BBI will seek to be c.1/3 of each investment, therefore requiring 2/3 co- investment from the private sector (with max 50% participation) Portfolio Management Processes in place for monitoring, reporting, follow-ons, exits etc. Operations and Structure Having appropriate permissions, registrations and authorisations to manage a BBI commitment www.bbinv.co.uk @britbusinv 71 Four Step Selection Process Expression of Interest Written submission setting out business model, investment strategy and addressing the investment criteria Formal Proposal A further detailed submission addressing feedback from EOI. Will include meeting management Due Diligence Full commercial, financial, operational and legal due diligence, including site visits and background checks Investment Committee BBI investment team presents proposal to the Investment Committee www.bbinv.co.uk @britbusinv 72 Timeline of Events June 2018: UKBAA Global Summit, Liverpool July 2018: BBI/UKBAA Angel Roundtable Event, FBH October 2018: Launched Request for Proposals November 2018: UKBAA/HMT Roundtable, Manchester December 2018: UKBAA Future Forward Event, London UKBAA/IUK Manchester (16/05), Bristol (21/05) July 2019: BBI/UKBAA workshops re legal, regulation, administration. www.bbinv.co.uk @britbusinv 73 Angel networks and syndicates - Networks and syndicates can be informal groups of business angels, often loosely formed, operating under the self certified sophisticated investor safe harbour, investing on a deal by deal basis. There are estimated to be over 40 angel networks in the UK. Equity platforms - Equity crowdfunding platforms allow retail investors to invest in many opportunities, often alongside venture capital funds and lead angel investors. The three largest players in the UK are Crowdcube, Seedrs and Syndicate Room. Angel Funds/Managers - There are an increasing amount of new EIS funds, which have a dedicated fund manager to manage committed capital to invest into EIS eligible opportunities. Investors in such funds can be angel investors, however they tend to be passive high net worth individuals. EIS funds can invest on a bilateral basis or also club together with a syndicate or platform. Types of Applicants to Date British Business Investments is the trading name of British Business Investments Ltd, the commercial arm of the British Business Bank. British Business Investments Ltd is a wholly owned subsidiary of British Business Bank plc, registered in England and Wales. (registration number 09091930, registered office at Steel City House, West Street, Sheffield, S1 2GQ). It is not authorised or regulated by the PRA or FCA. British Business Bank plc is a development bank wholly owned by HM Government and is not authorised or regulated by the PRA or FCA. British Business Bank plc and its subsidiary entities are not banking institutions and do not operate as such. A complete legal structure chart for British Business Bank plc and its subsidiaries can be found at www.bbinv.co.uk www.bbinv.co.uk @britbusinv No representation, express or implied, is made by British Business Investments as to the completeness or accuracy of any facts or opinions contained in this presentation and recipients should seek their own independent legal, financial, tax, accounting or regulatory advice before making any decision based on the information contained herein. No part of this presentation should be published, reproduced, distributed or otherwise made available in whole or in part in any jurisdiction where to do so would be unlawful. PANEL 3: REGION IN FOCUS GORDON BATEMAN Founder Investor Ladder JAMES BEDFORD Head Of Investment Partnerships Tech Nation PATRICIA KEATING Director Tech Manchester SUE BARNARD North West Senior Manager British Business Bank ALEX WILSON Investor Nvm Private Equity ANDY DAVIDSON Head Of Business Relations Northern Powerhouse Partnership # ConnectedInvesting @UKBAngels CLOSING REMARKS JENNY TOOTH CEO UKBAA # ConnectedInvesting @UKBAngels THANK YOU! Join our upcoming events at connectedinvesting.ukbaa.org.uk # ConnectedInvesting @UKBAngels

Slides from Connected Investing Manchester event held on 16th May 2019 at Manchester Science Park, organised by UK Business Angel Association in conjunction with InnovateUK.

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