Alliott Cole, member of the ventures team at Octopus Investments, sits down with GrowthBusiness to talk about how to cultivate a relationship with a venture capital firm.
Trying to obtain growth capital is a difficult process for many early stage businesses. Alliott Cole explains how to approach VCs and what to expect from a meeting.
There is a suggestion in this interview that, once again, entrepreneurs outside the social whirl of Venture Capitalists, stand little chance of being heard. It's the old story of, 'who you know'. This is a problem, unique to the British, which was supposed to be overcome by the TSB but has utterly failed to do so.
Things in the USA are completely different. The only thing which separates entrepreneurs from seeing VCs and other funding bodies, is distance. If you have a good idea or product, someone with access to money will be glad to see you. Over here, the good idea or product takes a distant second-place to the people you know. Being a graduate or a researcher for any one of our big Universities is far more important than the innovation itself. Having a link to the TSB through a University or via one of the larger OEMs puts a person way ahead of the competition and almost guarantees an audience with the people with money. A shop-floor worker, by contrast, who has invented the world's first Cold-Fusion apparatus, would stand no chance of getting any support from the Government while 99% of VCs would dismiss his approaches out of hand.
The USA may be in financial difficulties but support for their entrepreneurial community remains as strong as ever. This can easily be judged by the huge number of small US companies which are producing really good, technologically advanced products to the UK many of them employing UK innovators. If there is any doubt about the crippling effect this disgraceful attitude is having on the struggling UK entrepreneurial community, consider the gaps in the market unfilled by British innovators and entrepreneurs.
USA UK
New type IC Engines 34 0
Drones (UAVs) 12 0
HEV Batteries 4 0
HEV Generators 16 0
HEV Alternators 5 1
HEV Electric motors 18 1
HEV Ultra Capacitors 1 0
HEV IC engines 22 0
Lightweight vehicle bodies 8 2
Military hardware 50+ 2
Helicopters 6 1
Electric cars 8 0
Computer hardware 100+ 2
Robots/robotics 12+ 0
Marine outboards 10 0
Model aircraft 20 1
Sports equipment 70+ 2
Vehicle electronics 52 2
Wave and wind machines 10 0
Garden machinery 15 0
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