Feature Angel Investment
but he does advise knowing who your investors are and how they could be helpful in growing your business. “They’re minority shareholders at the end of the day; they will be able to help but it’s up to them what kind of input they want to have. Of nine, one of the angels is a board member, one is an observer on the board and the rest are more passive. They come from quite a wide range of backgrounds and when you’re aware of their skills and disciplines you can leverage that and they tend to be quite open to it, like in teeing up introductions. So understand who your investors are and what their strengths are. As a start-up, your network is one of the most important things you have.” Tinsley also has some advice for companies looking to secure angel investment: “You need to have a compelling proposition and market. The investors will have successful business backgrounds so you need to know your numbers inside out. They’ll be used to looking at these things and if you’re dealing with them for the first time, take time to really understand your numbers and the implications of your proposition. And come prepared for questions.”
International Investment HBAN has expanded its reach internationally this year, launching international syndicates in London, Singapore and New York, which means additional funding is available to Irish start-ups, along with access to new UK, Asian and US markets. Investors from the new syndicates have already invested in five Irish companies. “Access to international private equity and new markets is hugely important for the Irish start-up ecosystem,” says Phelan. “Through the three new international syndicates, Irish start-ups can now leverage the local networks of these international angels to provide them with support in targeting the local markets in which they are located.”
Fidelma McGuirk, founder and CEO, Payslip
The Right Stakeholders Payslip is a global payroll management software founded by Fidelma McGuirk. When launching Payslip, the entrepreneur said she didn’t want just one investor, but a combination. “I have VC, Enterprise Ireland funding and angel investment. Why did I want a mix? I wanted funding but I also wanted investors with a track record of investing that knew about growing investment, and attached to that they’d have weight in the market. So while it was about getting investment into the company, it was also about getting the right stakeholders to support the business and fill in the gaps.” Payslip has received investment through two HBAN syndicates, Bloom Equity and WxNW HBAN Syndicate, and McGuirk also stresses how important the angel network has been. Business leader and tech executive Andrew White of the Bloom syndicate sits on the Payslip board, and McGuirk says his participation has been very positive. “The angels have been very useful. Maybe I’ve been lucky with the ones I have, but the Bloom syndicate are all tech or ex-tech and they offered additional support that I have availed of – they knew people they could introduce me to to help me beef up my offering.” McGuirk also stresses that angel investment is a two-way street and says it’s important to be honest with your potential investors but also to ask them
open questions. “There’s a second stage after the pitch where the investors and business meet and have an open conversation and you find out how interested they are once they really get under the bonnet of your business,” she says. “Choose an investor that understands what it means to be an investor – they need to understand that there may be multiple possible exits. You’re going to be honing your business, your market, your product and pricing and everything else along the way.” For HBAN, Phelan says the aim is to bring in new investors consistently. He believes the Employment & Investment Incentive (EII) needs to be overhauled to drive this type of investment and support Irish companies and investors. “One of the important things for investors coming in is tax. I have potential investors telling me that the property down the road has a much better tax incentive, so why should they put money into a tech company? The EIS in the UK in comparison is a win-win and hence the volumes that have gone into investment there is phenomenal compared to what we have here. “Five years ago, an investor might have needed a minimum of €100,000; now that’s not the case. We’re hoping to drive a lower barrier to getting in and that’s why we have syndicates, so people can come in with €20,000. So if we have efficient EII relief and an investor puts in €20,000 then they should be able to get a good return.”
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