Welcome > Blog > Blog Posts

Looking to raise finance? Banks are not your only option …

4th January, 2017 No Comments


Various coins presented close up on banknote background shown in the distance

Raising finance can be a difficult task. Entrepreneurs and experienced businessmen alike are talking about ‘the banks not lending’. This is also a common headline used in the press when writing about the economy and recession. When faced with such a statement, you often have to ask “So where have you looked? What lenders have you approached? Who else?”

Access to credit is vital for businesses to expand, develop new products and, ultimately, contribute to economic growth. Business West’s Quarterly Economic Survey – part of the British Chambers of Commerce national survey, which is a highly respected snapshot of economic conditions for business – asks ‘What barriers to growth have you experienced?’ and, consistently, one of the top answers is always access to finance.

Yes, lending has reduced since before the recession, but could this statistic potentially be somewhat due to a lack of knowledge of the different sources available? 71% of small business owners, in an AXA survey, said they had not heard of crowd funding and 54% were unaware of the existence of peer-to-peer lending.

In these uncertain political times, alternative sources of funding can offer a huge boost to small businesses and are an increasingly viable option for growth. Some people may say traditional methods of raising finance, such as banks, aren’t what they used to be, even though banks were never meant to be the ‘be all and end all’ when it comes to investment. It is important for business owners to understand the wealth of other opportunities out there, some which come with greater control. For example, Self Directed Pension Schemes are under used and arguably under rated for the purposes of assisting business growth. Pension-led funding is a type of commercial finance which offers an alternative to traditional business funding, such as bank loans or overdrafts, and involves using business owners’ accrued pension funds to invest in their own companies. Pension-led funding doesn’t require personal guarantees and enables you to use Intellectual Property (IP) as a legitimate asset class, which broadens the opportunity further. More than 1,300 businesses in the UK have successfully used this type of funding.

Other options including equity crowdfunding have become much more popular in the last few years, but it can be much tougher to pitch successfully online than clients anticipate – seeking advice beforehand is highly recommended. Angel investor funding can also offer mentoring support alongside investment, but valuations can be tight in some sectors and the process can be time consuming, so it’s definitely worth speaking to an expert to look at all the options available, then weighing up the pros and cons.

There are also other forms of finance such as grants. Grants are pots of funding for a specific purpose and are usually match funded. To find out if there are any grants to suit your purpose and to check eligibility criteria, visit the Gov Support Finder.

What businesses need to understand is that there are other ways to access funding and different solutions can be found. But, it’s important to ask, why should someone lend to you or your business? The answer is they shouldn’t, unless you can prove to them that you are worth investing in.

Written by Tara Gillam, Head of Enterprise at Business West delivering business support in the South West.

 

Transparency is coming to legal fees …

11th August, 2016 No Comments


Various coins presented close up on banknote background shown in the distance

Our latest Guest Blog from LawyerFair, the on-line law services platform, reviews how pricing in the industry looks set to be revolutionised:

LawyerFair recently delivered a presentation to 80-100 business owners and opened with a simple question … “How many of you, when instructing lawyers for your business, had advanced knowledge of your fees?”

Remarkably, but perhaps not surprisingly, the show of hands was zero.

Not one business owner, in a room of relatively sophisticated and regular buyers of legal services, had forward visibility of costs on their legal fees.  And this anecdotal experience of how lawyers still charge, has been endorsed by a recent report from the Centre for Policy Studies – The Price of Law – which accused law firms of “using a lack of transparency on fees to distort the free market in a way that creates inefficiencies and undermines the wider economy.”

The report continues “The high level of legal fees is an efficient drain on commerce. British industry is forced to suffer a deadweight loss as excessive amounts of time and money must be spent dealing with legal issues.”

Jim Diamond, former lawyer and author of The Price of Law, revealed in an article in the Daily Mail that firms typically bill in six minute units of time, and that “for typing ‘yes’ or ‘no’ and hitting ‘send’ on an email, the partner might count it as a six-minute time unit and bill £110 for 30 seconds’ work.”

To those who know how the traditional solicitors model works, this report is hardly a surprise. Law firms continue to measure success, by the growth of their hourly rate … an anachronistic charging model, that places all commercial risk on the shoulders of the buyer.

But, there are shifting sands in the legal market, and the era of guesswork surrounding expertise and cost is coming to an end.

We’re addressing some of these issues with my own platform at LawyerFair, where we pre-approve all panel lawyers and insist that quotes are fixed, but other services are emerging that help shine a light into this opaque market.

One particular service that’s starting to ruffle legal feathers is Premonition. Co-founded by a Brit, now based in Florida (Toby Unwin), the service utilises big data and Artificial Intelligence, to expose which Lawyers win the most cases, and in front of which Judges.  It’s ground breaking transparency and, having already caused a stir in the US, it’s expanding into the UK and beyond.

Buyers of commercial legal services – from start up to general counsel – have suffered from a lack of transparency in legal services, but in this new era of legal procurement, a variety of services have emerged that have started to shift the balance of this industry from supply led, to demand led.

You might say that historically when it comes to fees, it’s the land of the blind where the one eyed lawyer is kind but …. in the future landscape of legal services, consumers with market intelligence will be King.

Written by Andrew Weaver, CEO & Co-Founder of LawyerFair

If you would like to compare legal fees, LawyerFair can do an audit of fees for free, as well as offer legal advice, so please do get in touch.

 

Pitching your business idea is easy.  Or is it?

9th August, 2016 1 Comment


Multi ethnic business group greets somebody with clapping and smiling

You’ve come up with a great idea for a new product or service and you need support, whether it be financial, technical, or professional partnership.  The next step is convincing the right person to give you that support.

So what do you have to do?

Finding the right audience to pitch to is the obvious first step (and there’s a few links below to help with the search), and then you have to prepare your pitch.  And prepare you must!  Your idea will be as clear as crystal in your own mind but you have to portray that idea to others with the same clarity.

Whether pitching to a friend or associate, a group of business angels, or a bank manager, and whether it be face-to-face, using a business plan, or online, there are some fundamental rules to ensure you make your pitch the best it can possibly be.

Be prepared

Make sure you have all the relevant facts and figures at your fingertips – have a print-out with you that you can refer to both at face-to-face pitches and when preparing a written or online pitch.  You should also consider producing a one or two page brief summary; use your business plan as a back up to your pitch (in some cases your business plan will form the major part of your pitch – particularly if you’re talking to a bank about finance); consider producing a PowerPoint presentation; and develop a 5-minute elevator pitch.

Investors are as interested in the entrepreneur as they are in the business idea (maybe even more so) so prepare yourself too!  Be confident in your idea and show a passion for the business.  Investors need to know that you are logical, efficient, quick-thinking, and able to see your idea through.  They also need to know who you are, so be yourself!

Practicing your elevator pitch for face-to-face meetings will bring confidence but you also need to have answers to all the potential questions that might be asked of you.  Know your product, costs, market, and processes inside out and you will not be caught out by questions you cannot answer.

‘Knowing the enemy’ will give you an advantage too.  Research the investors wherever possible and use the information to your advantage to benefit your business – do they have experience in your industry? ; have they invested in a similar business before and how successful was this? ; how much time do they have to support you and your business?  Pitching to the wrong people is both a waste of their time and yours!

Pitching your idea

Spencer Waldron, presentation expert at Prezi, suggests that the best pitches tell a story.  Consider formatting your pitch with an introduction, a middle section of ‘chapters’, and an end where the main character in the story is your proposed market / customer.

The introduction could cover what is available now and the gap in the marketplace that your product or service will fill.  The middle chapters will cover your target audience and their needs; why your product will benefit them; why they will buy from you; who might stop your business being successful and how you will counteract this.  And the end would be the growth plan for your business and your exit strategy.  It would be worthwhile adding a brief summary which highlights the 3 things you want people to remember from your pitch – choose the 3 wisely!

Ensure your content covers all the issues that your potential investors will want to know about:  customer base; your team; costs and financial forecasts; competitors; and, of course, what exactly is it you want from the investor (and, where applicable, what do they get in return).

And finally your presentation should be well designed – smart, crisp, and to the point.  And make sure your personal appearance is as polished as your presentation.  In any printed or digital material keep text to a minimum; highlight important parts with ‘bold’ / text size / text colour; discuss one point at a time (in a PowerPoint that’s one point per screen); and use photos and images wherever you can.  Finally, maintain your branding throughout your presented materials.

So, there you have it – pitching your business idea is easy, isn’t it?

Written by Davina Young, Marketing Manager at Cavendish Enterprise

 

Cavendish Enterprise partners are able to advise and support you in writing your business plan.  Our business advisors can also assist with other skills and knowledge you may need to develop your business idea.

Some useful links:

Additional tips and thoughts on ‘how to pitch your idea’ from the British Library and from James Caan of Dragon’s Den.

Once you’ve got your pitch ready, the following links may be useful:

Pitch to Peter Jones

Pitch to Angels’ Den

Pitch on BBC’s Dragon’s Den

Launch your project on a crowdfunding platform

Looking to start a food and drink business?  Pitch on 16th Sept 2016

Pitch your business in Dundee, Scotland

.

The importance of validating your business idea and creating a solid business plan

1st August, 2016 No Comments


Man with graphic question marks in chalk

You have a business idea ……….. the inspirational ‘Eureka!’ moment.

And of course you want to get started immediately.  But there are a few things you need to consider in order to validate your business idea, as well as the need to produce a supporting business plan. Ask yourself the following;

Is your business original?

Using a search engine and social media sites to search for your idea can show you whether your business is original, but remember to look beyond the first results page.

Researching your competitors is essential if you are validating your business. If there are similar products or services on the market already, having competitors is not necessarily a problem. It just means there is a demand for your product or service and by identifying your competition; it will help you to recognise what differentiates your business.

If you have a unique selling point (USP), you will be able to win and maintain a higher share in the market. You can also learn from other business’s mistakes and successes by understanding how they promote themselves and who they target. Google Trends can also be useful for validating whether you are going into a stable or growing market.

Can you validate the demand?

You can reduce the risk of selling something that nobody will buy by validating the demand for your product or service and its market. Compiling a list of potential customers will also help to reduce the risk of low traffic in your initial few months.

A way to find out if customers would be willing to pay for your product or service is to set up a free landing page. Useful sites for free landing pages are Strikingly and Launchrock. Strikingly uses no code and you do not need any design experience to build a page. Launchrock is also easy to use with a block-based builder and custom HTML blocks.

Landing pages will usually feature a short snippet about your product or service with ‘coming soon’ or ‘in development’. The key is to make your landing page attractive to capture the email addresses of visitors. You can see how many people are visiting your site by using an analytical tool such as Google Analytics, or by creating a sign-up form using sites such as Wufoo. This sign-up form will ask people to leave their email address if they would like more information on your idea or your launch. If lots of people visit the site, you will know people are interested in your idea.

Another way to validate your business is to send out surveys. By using tools such as SurveyMonkey, you can send it out to all your contacts and get it shared on social media. It is important to ask the right questions so you can gather as much information about your idea as possible. Examples could be:

• Would they buy the product or service?
• Do they like the name of the product/business?
• How much would they pay?

The answers to these questions can help shape the final launch of your idea and give an indication of how successful the idea can be in comparison to how many people are engaged.

Have you produced a business plan?

Your business plan is the document that allows you to turn your thoughts and ideas into a business. It may seem like an intimidating task but it is a valuable document outlining your business strategies and makes you think about every aspect of the business to understand it thoroughly.

As your business progresses, your time working on the business will become more limited as you spend more time in the business. Consulting your business plan can allow you to make more informed and effective decisions and ensure you are keeping on track.

Also, a business plan is vital for anyone seeking or thinking of seeking finance, now or in the future. Banks, investors and other lenders will expect to see a business plan and will not provide capital without one. It provides them with an overall understanding of the business and the likely returns. Keep you business plan active so you are able to refer back to it and keep business progression on track.

Are you asking for help?

There is nothing wrong with asking for help when you are starting a business.

There are numerous services to provide you with the support and guidance you might need. Industry experts can help you understand how to make the most of opportunities and further identify the needs your target market. A mentor is a valuable asset to anyone starting a business and this avenue shouldn’t be overlooked. A mentor can give you one-on-one support and provide you with dedicated advice and guidance.

Another great way to get your business off the ground is to attend seminars and workshops which can help you develop necessary skills and knowledge. You can get support for your start-up through the Start & Grow programme which is tailored specifically to your needs and your business idea.

Written by Tara Gillam, Head of Enterprise, Business West – delivering business support in the South West

 

 

3 Key Legal Considerations for Online Publishers: Copyright/Plagiarism, Defamation and Misrepresentation

15th July, 2016 No Comments


Businessman using digital tablet computer

As Cavendish Enterprise trials the services of an interactive platform hosted by JournoLink which supports our Start & Grow clients in the management of their own PR and gives them access to journalists, broadcasters and bloggers, we’ve asked LawyerFair to highlight some of the legal issues around publishing content online.

This article will briefly discuss three key legal considerations which apply to the publication of material online. Firstly, the issue of copyright/plagiarism, secondly, the laws applying to defamation on the internet, and lastly, laws relating to misrepresentation online. Note, this general overview is not legal advice, and is provided for information purposes only.

1. Copyright/Plagiarism

Breach of copyright is a common issue which applies to material posted online, and can present significant risks for an online publisher. Broadly, copyright infringement relates to the unauthorised replication of a substantial part of another person’s work. Copyright infringement can relate to any form of artistic or multimedia work, including written materials, images, video, and sound recordings. Software code itself is also considered an artistic work and is therefore subject to copyright. Copyright arises automatically without registration, although it can be useful to provide a copyright notice in the format of © [Year], [Owner name] in order to assert your ownership.

As noted above, the test for copyright infringement is whether a substantial part of the work is taken, without a licence. Primary copyright infringement only requires actual copying, but secondary copyright infringement (i.e. dealing with or hosting copyrighted works) requires knowledge. The definition of “substantial” is a question of quality not quantity. Therefore, it is possible to infringe copyright even if a small part of a work is copied, if that part represents the “essence” of the work that may have required considerable labour, skill or judgment to create. Conversely, if a copyright work lacks originality (such as a contractual agreement using standard terms), it is more difficult to establish that copyright has been infringed.

Plagiarism could be considered as related to copyright infringement, but is more relevant in an academic context. Broadly, plagiarism is the passing off of some else’s ideas as one’s own. It may not involve copyright infringement at all, as there is no copyright in ideas, rather, copyright only attaches to the expression of ideas on a particular medium. For example, it is difficult to allege copyright infringement for stealing the “plot” of a novel (although creating an unauthorised “derivative work” is copyright infringement, such as where a novel is converted into a film). However, taking ideas without attribution could breach an academic plagiarism policy. On the other hand, if someone copies written work verbatim (rather than the idea) this would be considered copyright infringement.

A common misconception is that copyright is not infringed as long as appropriate acknowledgement of the source or a citation is provided, however, this is not the case. Quoting material in an academic or journalistic context can confuse the issue, for example a research paper can cite another paper and may reproduce sections of that paper, provided that there is an appropriate citation. The reason is not because this would not be considered copyright infringement, but due to defenses to copyright infringement, such as fair dealing and use for the purpose of criticism, reporting of public affairs, or research. It is important to note that such defences vary by jurisdiction, for example, fair dealing is called “fair use” in the USA is much broader than fair use in the UK, which is limited to a few narrow categories. Therefore, it is not wise to rely on fair use as a defence to copyright infringement.

The safest option for a publisher of online content who is wary of copyright infringement is to ensure that they have a licence to copy other materials (especially images, which can be obtained royalty-free) and to ensure that their materials are not being copied, except as permitted. For example, authors may wish to consider using a creative commons licence e.g. use with attribution (CC BY 4.0), non-commercial use (CC BY NC 4.0).

The main risk that copyright infringement presents to a publisher of online material is not necessarily the risk of litigation (which could be significant, particularly in the USA, where “statutory damages” are available for each instance of infringement or website “hit”). Rather, the main risk is that the website is taken down. In the UK, a web host can be liable for copyright infringement if they do not remove the offending material “expeditiously” if they have “actual knowledge” of infringement (see Reg 19 of the Electronic Commerce (EC Directive) Regulations 2002). If a website is hosted in the USA, it is possible to issue a DMCA takedown notice, which can force the host to remove the offending website. It is also possible to inform search engines of the copyright infringement (e.g. Google, Yahoo, Bing etc) which will lower the search engine rankings of the website.

2. Defamation

The laws regarding defamation online are complex and also vary by jurisdiction. In the UK, the main laws involved are the Defamation Act 1996 and 2013, the Defamation (Operators of Websites) Regulations 2013, and the Electronic Commerce (EC Directive) Regulations 2002.

Defamation is divided into two aspects, libel, which is defamation on some permanent medium (e.g. writing or posting on a website) and slander, which is more temporary, such as speech, or posting on a chat or bulletin board. The legal test for defamation requires that the statement tends to lower the claimant in the estimation of right-thinking members of society generally and must have caused or be likely to cause serious harm to the reputation of the claimant (e.g. allegations that they have broken the law).

There are exemptions and exceptions, such as truth, honest opinion, public interest, and privilege (e.g. solicitor-client, judicial or parliamentary). If a publisher exerts some control over content then could be deemed a primary publisher, otherwise they could also be a secondary publisher if they passively made the content available to others. It is difficult to determine in advance what level of involvement may incur liability. For example, providing a hyperlink to defamatory article could be deemed defamation as a primary infringer, but is not clear whether linking to the home website would also incur liability.

There is a one year limitation period to bring actions of defamation (see s 4(a), Limitation Act 1980). However, the Courts have a broad discretion to extend this limitation period if they deem it equitable. This limitation period runs from the date of publication, and in the online context, each new “hit” on a website constitutes a fresh publication. However, there is a “single publication rule” under s 8 of the Defamation Act 2013 which can limit this effect. In particular, a publication by the same publisher which is substantially the same and in the same form, will not renew the limitation period.

There are additional defences to defamation relevant to to website operators. Firstly, the intermediaries defence under section 1 of the Defamation Act requires the website operator to fulfil the following conditions:

• they were not the author, editor or publisher of the statement complained of;
• they took reasonable care in relation to its publication; and
• they did not know, and had no reason to believe, that what they did caused or contributed to the publication of a defamatory statement.

Secondly, there is a “website operators defence” under s 5 of the Defamation Act 2013, which is broader. In essence, if a website operator did not post the offending article, they have a defence, provided that a notification procedure is followed under the Defamation (Operators of Websites) Regulations 2013 with specific time limits. Broadly, the complainant must send a notice of complaint to the website operator, setting out why they believe a particular statement is defamatory. The operator must contact the poster within 48 hours with a copy of the complaint, and ask them whether (a) they consent to removal of the statement and (b) whether they consent to their identification being provided to the complainant. If the poster is not available the operator must remove the statement within 48 hours. Otherwise, the poster has 5 days to respond, and can refuse consent to removal and identification to the complainant (although they must provide their name and address to the operator). In that case, the complainant will have to seek a court order to obtain the posters details from the operator and remove the statement. It is notable that mere moderation does not make an operator a poster of the material in accordance with s 5 of the Defamation Act 2013. However, the defence does not apply if the operator has acted with malice in relation to the posting of the statement concerned.

3. Misrepresentation

Misrepresentation can be an issue for publishers of online material, particularly where there are undisclosed conflicts of interest. For example, the fact that a reviewer will receive a commission for sales of a reviewed product via the website should be disclosed. Conversely, it is important to ensure that when mentioning other brands or trademarks on a website that there is no implied endorsement or suggestion of a commercial relationship that could be deemed trade mark infringement, e.g. including an Apple logo or branding on a website that is selling software products which are not approved by Apple.

A publisher should also be aware of consumer protection laws such as the Consumer Rights Act 2015 and Consumer Protection from Unfair Trading Regulations 2008, which outlaw misleading practices in trade. For example, an action by a trader is misleading if it contains false information or if it is likely to mislead the average consumer in its overall presentation. Therefore, a publisher making statements in a commercial context should be careful not to be misleading or provide false information.

Conclusion

Online publishers should be aware that material published online has legal implications. Firstly, they should ensure that no copyright is infringed and that contributors know what is permitted and agree not to publish copyright material in breach of a licence. Secondly, they should protect themselves from liability for potentially defamatory material by ensuring that they fall within the exemptions when they post the material or otherwise follow the notice procedures specified in the Defamation (Operators of Websites) Regulations 2013. Finally, publishers should ensure that they do not provide misleading statements online, particularly in a commercial context such as where goods or services are being sold.

If you require any specific assistance regarding the publication of online material and advice regarding their particular circumstances, do not hesitate to get in touch with LawyerFair.

Click here to learn more about the Start & Grow business support initiative and how you can receive the support of JournoLink (currently available in the North West, South East, and East of England) through the programme.

Written by Savva Kerdemelidis, Principal Legal Adviser at EULAW Online, and a member of LawyerFair

Cavendish Enterprise Logo Cavendish Consortium Ltd.
Leigh Court Business Centre
Abbots Leigh
Bristol BS8 3RA

Built by Accent Design Group Ltd.

CONTACT:

E: [email protected]