City of London Corporation boosts Tech City as entrepreneurs fight for up to £500K

On Wednesday 25th April, at the Innovation Warehouse in the City of London, 15 digital technology entrepreneurs from Tech City and the City-fringe boroughs offering a range of business opportunities from an author’s web platform, to an app-creation tool for non-techies, to an online art store – faced this test as they competed for funding. From a wide number of applicants, the selected entrepreneurs had the opportunity to access funding that offers the potential to transform their future, propelling them from early start up to accelerated growth businesses, at the first pitching event for the City of London Corporation’s new scheme Angels in the City – a key part of its supporting communities and growth programme.

These ambitious early stage businesses pitched to receive support from Angel investors recruited under the City of London Corporation funded scheme Angels in the City, delivered by London Business Angels. They had the opportunity to access not only financial resources but also the business experience, skills and bulging contact books of this team of City Angel investors.

A new generation of 40 high-net-worth investors have been recruited and extensively trained by London Business Angels under the City of London funded scheme to ensure they have specialist knowledge of the technical, financial and legal issues that form “the art of angel investment”. The City of London Corporation worked to set up the contacts and get the investors on board, with its experienced delivery partner, London Business Angels, staging a programme of expert-led workshops covering everything from risk and reward to syndication and negotiation on a deal. The new investors also have the opportunity to be part of a new syndicate of angels combining financial and business expertise. The key aim is to recruit 125 new angel investors from the City by March 2013.

The tech businesses pitching at the event on Wednesday 25th April included a social media platform that enables aspiring authors to promote their work, an online portal that allows non-techies to create their own mobile apps, and a website that selects affordable works of art to create an online “creative department store”. Each entrepreneur pitched for six minutes to attract the attention of the City Angels by demonstrating their proof of concept, identified market share, scalable business models and superior innovation skills.

Stuart Fraser, elected Chairman of Policy and Resources at the City of London Corporation, comments, “Facilitating finance and mentoring from City Angels to tech start-ups with high growth potential makes total sense for the City Corporation. Tech City’s thriving cluster of businesses, right on the City’s doorstep, is already the digital capital of Europe. It started out with just twenty companies back in 2007 and now has over 700 businesses. With the UK Government actively supporting the area and now City Angel investment flowing in, this is truly excellent for business and the reputation of London as a world leader for finance combined with innovation”

Raoul Tawadey, CEO of Circalit, an online platform first set up in 2010 where writers publish eBooks in order to receive professional feedback, went seeking £250,000 worth of investment at the Angels in the City pitching event.

Raoul commented: “This would really be a game-changer for us in terms of enabling further development of the product and website. We are aiming to build our mobile presence and expand into the smartphone and iPad app space so the funding will help us achieve that and allow us to fulfil our mission of becoming the “YouTube for writers”. The team here can’t wait to find out the results from the pitches”.

Julian McCrea, founder of digital company, Portal Entertainment, was seeking investment for his product ‘Immersion Go’, a patented technology that enables stories to be told over multiple devices while gauging the audience’s emotions to influence the direction of the story.

“Finding a City Angel to invest in us would make a huge difference. We would be able to develop our infrastructure, scale up the product and really start to mature as a company. People can be cautious about funding brand new technology – not everyone is a digital expert, yet – so this gives us a unique opportunity to really shine in front of people who understand both the finance and tech innovations”.

The scheme is part of the City Corporation’s wider initiative to support small business growth in and around the Square Mile and City fringes and is set to inject over £10 million of investment into start-ups and early stage technology ventures per year. It aims to generate 200 new jobs as a result of the initiative , helping to support Tech City as a beacon of opportunity within London.

The City Angels will be in a position to benefit from the new 50% tax relief following the Chancellor’s launch of the Seed Enterprise Investment Scheme earlier this month on 6th April 2012. This will favourably position start-up ventures seeking investment of £150,000 or less. The City of London Corporation aims to stimulate 125 city investors to consider putting both finance and business expertise into these early stage businesses over the coming 12 months as a result of this pitching, showcasing and networking session.