After having come across me on the internet, last week I received an email from an analyst at a leading investment bank asking if I was able to recommend any venture capital firms or angel investors that specialise in backing London’s early stage tech startups.
At some stage I plan to compile and publish a more comprehensive list and resource, but for the moment here are a few of the main equity investment options for startups that spring to mind:
While they don’t invest directly themselves, these platforms use technology and new business practices to significantly simplify the process of raising funds for startups and allow anyone from ‘armchair dragons’ to experienced angel investors to back companies at the click of a mouse. Crowdcube (based in Exeter, Devon) became the world’s first equity crowdfunding portal to launch and trade and has been followed by Seedrs in London. There are a number of other similar equity crowdfunding platforms being developed and because of the advantages of raising finance this way, not least the ability to build a powerful community as a result, these portals will soon become commonplace and the favoured way to fund startups.
The government recently announced the new Seed Enterprise Investment Scheme which offers startup investors significant tax breaks. I know of two organisations (Ascension Ventures and Jenson Solutions) that have put together SEIS funds to bring individual investors together to back the right opportunities.
Venture capital firms
In no particular order, here are some of the small venture capital firms that are focused on London’s tech scene: Passion Capital (backed by the UK government), #1 Seed, EC1 Capital, Octopus Ventures, DFJ Esprit, Lean Investments, Balderton Capital, Index Ventures, Accel Partners and Media Ventura.
Another new VC firm to consider is Kinetic Investments.
Probably the best known individual who invests in startups is Hussein Kanji, otherwise, this list that appeared in The Telegraph is a good guide, although many of the names will be involved with VC firms.
There are also organisations like Springboard and Seedcamp that run mentor-led accelerator programs for startups and provide seed capital as part of such schemes. A similar outfit is White Bear Yard which works closely with Passion Capital.
If anyone knows of any other seed finance providers that ought to be included in this post then please let me know and I can include them in my new business portal that I’m developing.