Raising funds as a tech entrepreneur

women-in-finance-Jessica Jackson, Investment Director at GC Angels, offers advice to female founders seeking funding to grow their business and stresses the importance of understanding the options that are available.

Raising investment for the first time can feel daunting. For many, securing finance, be it through debt or equity, is completely new and it can be difficult to understand the options, let alone make a call about which is best for your business and its needs.

The Alison Rose Review highlighted that awareness of, as well as access to funding are the two most common issues faced by female entrepreneurs, whether running a start-up or an established company. It also reports that female-led businesses receive less funding than those headed by men at every stage of their journey – but why is this? The report argues that women typically have higher risk-awareness compared to their male counterparts and are more cautious considering financial products. Women typically don’t have the same professional networks that male entrepreneurs benefit from, and are therefore less likely to know other entrepreneurs or to have access to individuals and organisations that are in a position to support them as they navigate the complex finance landscape.

Although the review states that it is difficult for female founders to find the right support in accessing finance, it’s important to know that there are a plethora of organisations and networks working cohesively to advise female founders. One such example is The Knowledge Transfer Network. Part of Innovate UK, they are actively working to support female business owners through its Women in Innovation programme. The network consists of universities, funders and investors who facilitate idea sharing, and encourage founders to embrace opportunities to innovate and scale to the next level.

Whilst it’s advisable to tap into any networks or organisations, the first point of call should be to gain an understanding of the different types of finance and which situations they are best suited for. This will help you make your own financial decisions and provide clarity on what you should be seeking.

Debt finance

This type of funding works in the same way as debt in everyday life – if you want something immediately but don’t have the required funds, you can take out a loan and pay it back later. In business, that funding could make a huge difference in striking a deal with a major supplier when you need to scale up on your stock levels for example. Debt is a great option: it’s quick access to finance which can increase working capital, allowing you to invest in growth. The downside is that the loan will accrue more interest the longer it takes to pay off, but hopefully the benefits of being able to grow your business quicker will far outweigh the costs of taking out the loan.

A good example of this is YourZooki, a premium liquid supplements brand our Debt team at GC Business Finance has worked with recently. The firm took out a £150k loan in February this year in order to invest in a new warehouse and create four new jobs. This was followed up with a second £150k loan in June, after the company had doubled its turnover in just four months, which has allowed it to increase its stock levels to cope with unprecedented customer demand.

Grant funding

Unlike a loan, grant funding does not require repayment. This type of finance is often overlooked by entrepreneurs as it can sound too good to be true, but it’s definitely worth checking your eligibility for business support. The Government website offers a useful tool to help business owners identify the various different grant schemes, which can be filtered by region and sector. It’s also worth discussing your options with your Local Enterprise Partnership or Growth Hub – you can find yours via the LEP Network.

An institution we work closely with is Innovate UK, which provides government grants to helps businesses “develop and realise the potential of new ideas, including those from the UK’s world-class research base”. This year, Marion Surgical, a company building a next generation suite of surgical simulators through virtual reality, received backing from Innovate UK alongside an investment from GC Angels. The funding allowed the company to invest in new projects, as well as create five new jobs.

The Knowledge Transfer Network is also a partner of Innovate UK, and is working hard to help female entrepreneurs with start-up grants, of which applications from female business owners has increased by 70 per cent since 2016.

Equity finance

Equity finance is the process of raising capital through the sale of some shares in your company in return for cash. The money can then be used to take on more staff, purchase equipment or invest in product development, which can in turn increase the value of your stake in the business without the worry of having to pay off loans and accrued interest. This can be useful for startup businesses which have not yet turned a profit but are showing signs of rapid growth – much like many innovative technology businesses we are seeing emerge today. However, the only downside is that you will no longer own the entire stake in the business, but there is real value in bringing an investor on board as it allows you to tap into their knowledge and expertise – they want your company to grow just as much as you do!

We have backed many excellent women founders with equity funding, and it has allowed them to take their businesses to the next level. In January this year, GC Angels co-invested as part of a £260,000 equity funding round in Immersify Education, a Salford-based EdTech start-up. The company provides learning tools for university students using augmented reality, interactive animation, gamification and personalised learning. Whilst the founder, Chloe Barrett, had launched a research-driven pilot across eight universities, she required capital to build out her development team and prepare her product for the market. Following the investment, the company is now targeting an official launch in the 2020/21 academic year.

Stories such as Immersify Education show what founders can do with the right funding behind them; all the more reason why it’s staggering to see that only one per cent of venture capital funding in the UK goes to all-female teams. GC Angels is striving to invest as equally as possible into entrepreneurs with funding ranging between £100,000 and £2m. Not only because it’s the right thing to do, but because it is estimated that up to £250bn could be added to the UK economy if women started and scaled their business at the same rate as men.

If that doesn’t inspire you, then you could always attend our events in Greater Manchester. Before the COVID pandemic, we hosted regular ‘#LaterPitches’ and ‘We Smash Barriers’ events – something I am keen to restart once social distancing guidelines are relaxed – providing ambitious women with the opportunity to hear and learn from other successful female business leaders.

If you are a job seeker or someone looking to boost their career, then WeAreTechWomen has thousands of free career-related articles. From interview tips, CV advice to training and working from home, you can find all our career advice articles here

Cyber Security

The importance of women in cybersecurity for innovation, investment and enrichment

By Stephanie Schultz, Executive Director at Trusted Computing Group

Cyber SecurityAccording to Small Business Trends, 2018 saw 20 percent of all jobs in technology held by women.

Of those companies in the Fortune 500 with three or more women in leading positions 66 percent saw an increase in ROI, found Women Who Tech. Since then, as we fly through 2020 into the new decade, women are becoming an ever-more prevalent and disruptive force within the tech market – particularly cybersecurity. In almost seven years I have worked in the cybersecurity sector with Trusted Computing Group (TCG), I have witnessed first-hand the enrichment their work has brought to the perspective of the industry, and how this has diversified its strategies for a more successful industry position.

Inclusion Sparks Insight

In my experience, women – though a minority in the technology sphere – have been leaders in the development of the industry. This success in leadership positions stems from the unique and refreshing perspectives brought by women to problem solving and identifying gaps in the market and demand within the industry. Being so deep in the technology we work on, it is easy to lose sight of who will ultimately benefit from it; the consumer. End users are the ones shopping, buying our devices and engaging in the community and a huge portion of this behavioral demographic are women.

Similarly, women engage with things differently in the ways they utilize and perceive things, such as IoT home devices where data is stored. As gender norms merge and more men adopt activities which used to be women-centric, understanding and implementing these perceptions is becoming more valuable. It is beneficial to understand consumer behaviors complimentary to and beyond a male-centric space, making gender diversity a key element to improving development, marketing and design strategies, creating well-rounded solutions and exceling in the market.

Within TCG, our male colleagues have nothing but the utmost respect for the women in the organization because it is recognized that they are good at what they do. Even among lively debates between parties in the conference room, I have never seen anyone brush off or dismiss or demean anything the female leaders have to say – it is always very mutually respectful, and we have an appreciation for one another. Being a member organization, I believe, allows for more diversity, welcoming a broad range of professionals from their member companies. This level of diverse collaboration, especially on the formation of global security standards, can only strengthen the quality of the work we do, and I am proud to manage and contribute to this.

Securing the Future

My role in TCG is largely engaging with the Board’s strategic direction. Beyond daily billing and legal admin, it is important to keep track of current technology trends and how they are progressing. Without considering the future of the industry and only focusing on the present, emerging opportunities will be missed – every device security aspect the consumer becomes aware of should have been considered by cybersecurity professionals five years in advance. In that respect, I facilitate the board to think about the direction of the organization for the future, collaborating with global government entities to ensure their perspective is also considered and their specialist security requirements of confidentiality are met. From the viewpoint of a woman in the organization, I work directly and regularly with other senior role women, from Work Group chairs to editors, to ensure that work from every division is promoted and driven towards a marketing angle. In doing so, my goal is to encourage everyone to follow through with their work beyond the technical development stage to present it in a usable and consumable way, reaching those beyond the cybersecurity sphere to increase TCG’s impact, reach and opportunities.

Despite my experience in my field, I am still committed to educating myself further so that I can offer my best to my organization. I am currently studying for my Master’s in Business Administration, with a focus on globalization, leadership and management. These are topics that will never sunset and are valuable to ensuring that security is prioritized and acknowledged by the rest of the technology industry. There are a lot of product developments and start-ups where security is, understandably, not a key concern due to the extra costs and likelihood of attack. Most companies don’t consider the resilience of their device security until it’s too late, but I want to change this. In progressing my professional development through the means of education, I want to drive cybersecurity to become a constant, standard practice in company product development from my position with TCG. As technology advances and ever changes, so will attacks – I want to see cybersecurity at the forefront of the industry, readily implemented to alleviate consumer concern.

To achieve this, it is crucial that we adopt as diverse a range of perspectives and ways of thinking as possible, to connect with as many surrounding sectors as we can and emphasize our value in ways that resonate with them. Women are an integral part of this strategy and must be seen as such in the path to encouraging this growth. As more female voices are highlighted in TCG and its member companies, making women more visible and the growth made evident internally, we hope to encourage female engineers who are interested in cybersecurity to join the work we are doing. TCG has been around for 20 years, and during this we have learned that building a force of diverse, new and younger talent in this way is key to keeping the mission alive and ensuring the success of businesses now and into the future.

About the author

Stephanie SchultzStephanie Schultz started her career industry association consulting and management working with homecare and hospice providers at the state and federal level to influence and advise policy makers on regulations and procedures to expand access to care. Her experience in advocating for and managing industry groups made moving into the world of cybersecurity standards a good fit. Stephanie joined TCG to provide administrative and specification development support and started representing TCG in the marketing efforts. Stephanie joined the Board of Directors assisting with the development and implementation of strategic efforts, relationship building and team management. She is currently an MBA student at the University of Illinois Urbana Champaign.

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cards leaning on a wire rack, invested in something thats not working

Are you too invested to let go of something that’s simply not working?

cards leaning on a wire rack, invested in something thats not working

Whether it be personal or professional, we all know the feeling of clinging on to something that we just need to let go of. Often though, it feels like so much time or money has been spent on said investment, that it’s too tough to simply pull the plug. Here, managing director of Q2Q IT, Lorna Stellakis, explores why it’s important to make a clean break.

While Coronavirus has left many business owners reassessing investments across their entire firm, the team at Q2Q HQ – from our own virtual workspaces – has been discussing the ‘sunk cost fallacy’ recently.

And specifically in relation to how much time we spend when it comes to fixing a piece of hardware – and whether it’s truly worth the hassle.

Generally, there is a misconception that you make rational decisions based on the future value of objects, assets, and experiences. However, the truth is that your choices can be tainted by emotional outlays you accumulate over time – and the more you invest in something, the harder it becomes to abandon it.

Humans are subconsciously programmed to avoid failures of any kind, and the prospect of loss can be a more powerful motivator on your behaviour than the promise of gains. In fact, several studies claim that the possible pay-off needs to be double the potential loss for many people to make a change.

As an example, have you ever been to the cinema and realised, 15 minutes into a film, that you’re just not going to enjoy it, yet you stay to the end because you’ve paid for the tickets? Or, you’ve bought a sandwich that tasted pretty bland but have still eaten the whole thing because you were hungry and didn’t want to waste the money or food?

While minor, these are great examples of the ‘sunk cost fallacy’ – almost like payments or investments that can never be recovered or enjoyed. A computer program with logical process would never ‘make a decision’ based on what’s already been invested, but as an emotional human we usually do.

Perhaps a more relatable – but less talked about – example is of a long-term relationship, whether that be a business one or a personal one. If we focus on the corporate relationship, it may be a service provider you’ve had a contract with for a while. You’ve spent months, or even years, devoting time and money to the partnership – but, it’s not quite living up to expectations.

Things might be okay – but is this really, well, okay? It might have all started well, but you’re having some concerns and the third-party doesn’t seem as invested in the alliance as much as you are, or even worse, the service has deteriorated yet you’re not privy to any explanation why.

At the same time, the thought of moving to a new provider might not really seem like an option. You’ve invested into the partnership, understand how each other works, and they know your business well. All this can make the fears associated with the potential upheaval of moving to a new supplier simply too ‘unknown’ to contemplate changing.

However, if we look at it from a different angle; time has passed, the money and energy has been spent and you’ll never get any of it back. If you can accept this, you’ll be able to make peace with what’s gone before and move on to something that will serve you better in the future.

This attitude and awareness will inevitably help you to make better decisions moving forward, and it’s something we embrace at Q2Q – both internally across our own practices, and when advising customers on the right hardware too.

The ‘sunk cost fallacy’ manifests itself in many ways amongst our customers – old and new – but we regularly receive feedback that they wished they had changed IT support provider months, or even years ago.

If you feel like you’re harbouring a love for some outdated IT infrastructure, and want to explore what the grass might look like on the other side of the hill, find out more about Q2Q IT, here: https://www.q2q-it.com/

About the author

Lorna Stellakis, MD of Q2Q ITMy role is to provide the overall direction and “eye on the compass” as to where we, as a team are heading, setting the overall business strategy and financial budgeting. Whilst always having been involved with systems implementation throughout my career, I have an operational background and no specific IT experience. However, if anything, I believe this makes me more qualified to ensure the team deliver great service, drawing from my operations experience, and having been on the wrong side of poor IT support in the past. I can relate to how crippling this can be to a business, making it paramount that we ensure that IT issues are as invisible as possible, leaving the customers to get on with running their businesses smoothly.

If you are a job seeker or someone looking to boost their career, then WeAreTechWomen has thousands of free career-related articles. From interview tips, CV advice to training and working from home, you can find all our career advice articles here.