More good news: another success!
Yet another business is getting off the ground thanks
to microFunding.We are often asked if there have been many
(any?!) successes. And it is a difficult question to answer,
because the timescales involved are longer than microFunding has
been around. My answer goes as follows:
It could be said that microFunding has been shaking the Tree
of Inventions, and has dislodged a lot of seed. Inevitably, upon
closer inspection, much of the seed has turned out to have holes
and is not viable. Some of the good seed hasn't found itself in
fertile soil, but some has. And now we have several little trees
beginning to germinate, some even have a few leaves. But there
certainly are not yet any great Oaks; for that we'll just have
to keep waiting.
What happens if a Project fails?
It is important to understand that both Manager and Investor are
highly motivated to make the Project work. The Investor will
have put in total risk capital (not much in Business Angel
terms, but still total risk) while the Manager will have spent a
lot of time and resource investigating, preparing and specifying
the Project, all wholly unpaid and at personal risk. Clearly the
Inventor also wants it to work.
Determining that it is a failure will be tough, but if it is,
it is: we recently had a brilliant idea that (it turns out) was
patented in the 1800s. It must happen all the time: brilliant
but commercially worthless.
The company that has been set up to run a Project may or may
not have funds left: no doubt it will have if a killer reason
for failure has been found early on. All funds net of expenses
go back in entirety to the Investor (that is why it's a loan and
not equity), and the small blocking shareholding owned by
microFunding is “sold“ for a penny back to the Inventor, who
walks away with the IP and assessment results. He can do what he
wishes with them, with everyone's blessings.
Why Invest?
microFunding was started in order to benefit Business Angels,
not Inventors!
Business Angels are always complaining about the lack of good
quality deal flow, which means good opportunities run by highly
competent managers.
The three pluses microFunding has for Investors are:
Firstly they get exactly that, good opportunities run by highly
competent managers
Next, while they have a high risk of total loss in the
Project stage, it is designed to have a minimal sum involved so
any loss is inevitably small in quantum, while the winners have
unlimited upside
Lastly by making investments in units of exactly £2500 we
encourage a portfolio investment approach. The “Risk-Reward“
ratio is thereby significantly improved.
Most Business Angels do not at first understand these
benefits, but once they understand the deal, they buy in - they
may be unaware but they're definitely not daft!
Join the Linkedin debate
Dr Ian Goodyer
(http://www.reydoog.com/microfunding.php) has
inspired some good discussions on Linkedin: why not join the
debate?
The link is
http://www.linkedin.com/e/vgh/3077363/
With many thanks, Good luck from
the microFunding Team
The reduced offer for posting new
inventions on
www.equityentrepreneur.co.uk is now finished: but for
news of new deals, watch this space!
microFunding has increased its fee to post an idea in order
to avoid competing with its own introducers - but -
we now have:
- 7 active introducer sites, and
- 57 new introducer web links to microFunding in progress
Introducer sites charge their own fee and provide their own
services. Why not check out the active introducer sites? Some
charge very little, while one charges as much as £200 + VAT -
but you do get a full Patent Review included in that, which is
actually extremely good value!
www.microFunding.co.uk
www.equityentrepreneur.co.uk
www.UKBA.co.uk
www.Fundnewbusiness.co.uk
www.Financenewbusiness.co.uk
www.Angelsden.co.uk
www.microFundingnorthwest.co.uk
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