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QIB Q4 – Funds and other animals

Published on December 7, 2018

On Thursday 6th December Engine Shed hosted the final Quarterly Investment Briefing for the year at Framework on King Street in Bristol. A gathering of over 30 investors and colleagues came together for the fourth time this year to share, learn and network.

This event and associated newsletter is an endeavour led by Briony Phillips, Associate Director and Scale up Enabler intended to help increase the amount of investment and investment related activity in the West of England. Here she shares her observations and reflections from the session which she hosted.

The final session of the year was focused on a topic which we (that’s the royal we – Engine Shed and friends across the sectors) have been discussing for a long time – the possibility of a regional investment fund. This is a conversation that began more than a year ago – with a (now defunct) proposition of Great Western Ventures and was built upon at a roundtable discussion come dinner in May this year. At the dinner we learned about 3 possible regional investment funds and discussed the feasibility of such a thing. So yesterday, at the event I shared a quick run down of the discussions that have gone before and of the regional investment fund landscape:

Birmingham // Midlands Engine Investment Fund (£250m total)
£100m equity finance for SMEs, partially ERDF funded Managed by British Business Bank // Mercia

Wales (c. £38+m for Tech)
Welsh Development Bank £1b across 11 funds inc. Tech Seed Fund and Tech Investment Fund and Angel Co-investment Fund. Companies need to be ‘willing to move to Wales’

Cornwall // Isles of Scilly Investment Fund (£40m)
Debt and equity fund, partially ERDF 2014 – 2020
Collaboration with British Business Bank

Which raised the question of why isn’t there something similar in the West of England? Some people observed that there’s already a good flow of capital into the region, and that there’s a strong population of high net worth individuals locally too. However, the opposing view suggests that it takes 3 times longer to raise investment here in the West of England than it does in London – and that 68% of the angel investment in the country goes to the golden triangle of Cambridge, Oxford and London according to UKBAA analysis. In terms of local efforts, the I mentioned a few highlights from the mapping exercise that I completed to highlight the investment ‘actors’ in the region:

Main seed investment infrastructure:

Bristol Private Equity Club (BPEC)
‘Incubators’ – RocketMakers and SimpleWeb Ventures
Informal angel investor links – often through hubs // regional contact points

Later stage
Investors in residence at Engine Shed – Maven Capital, ADV, DeepBridge Capital and Bristol and Bath Regional Capital
Introductions through incubators – if companies are members/tenants with well-connected organisations

Parkwalk Investment Fund
Fund specifically for University of Bristol spinouts and University of Bristol related companies and SETsquared businesses

For more visit: www.scaleupgenerator.co.uk/investment

And that brought us to the main event of the session – Tim Morgan, a local businessman and angel investor, shared news of his new MicroFund – SouthWestern Ventures:  www.southwestern.vc. A fund which hopes to raise c. £1m locally which will be invested into 15 – 25 of the ‘most ambitious startups in Bristol and the South West.’

I rounded off the session with a run down of data from Beauhurst to help everyone see the trends, patterns and progress in the investment activity in the region. I highlighted the 20 companies that have (according to Beauhurst) raised in the West of England in the last quarter, and those who are actively raising in the region at the moment too. If you’d like to find their names, check out slides 16 – 18 in the slides linked below.

Earlier in the day, I also compered the Silicon Gorge final – at which 6 companies pitched for sub-£1m investment and a further five pitched for more than £1m. This competition is organised locally by TechSPARK and received 54 applications from companies across the region. If you want to find out more, you’ll find the names of those companies that pitched both in the slides linked below and in this TechSPARK article: https://techspark.co/silicon-gorge-pitchers-announced-for-showcase-at-bristech-2018/ If you contact me directly, I can also share their pitch decks with you.

Oh and in case you missed the news which hit the headlines this week at Sky – Graphcore have a funding round in the offing which will see them reach a billion dollar valuation (I spy a Bristol unicorn!)

Want to be at the next one?

If you are an investor and you would like to receive invitations to future QIBs, and to see the Quarterly Investment in Brief newsletter hit your inbox, please sign up here: http://bit.ly/ESQIBFORM.

If you are a scaleup founder I’m afraid this isn’t the event for you. However, if you would like me to share your investment proposition with this group, please send over a one page summary of your proposition at least 48 hours in advance of the QIB events. Dates for 2019 will be published in the New Year.

The Quarterly Investment Briefings and newsletters are kindly sponsored by Smith & Williamson, KPMG and TLT Solicitors.

Want to know more about the entrepreneurial ecosystem in the West of England? Check out our Growth Map of the 56 most-mentioned places you should know about.

Find the slides here:

This blog is part of a series by the Scale up Enabler, Briony Phillips. You’ll find more details on her work on this website. You can contact her via email briony.phillips@engine-shed.co.uk or meet her at one of the planned events: http://www.engine-shed.co.uk/events/