We caught up with Stephen Page, founder of Startup Funding Club Ltd, an organisation we hear many entrepreneurs are turning to, to help them secure SEIS investment.
One thing that has been consistent throughout Stephen’s years in business is his desire for the freedom to make his own decisions, and follow his own path. He proudly points out that the only time he has been formally employed by anybody is the 4 years he spent studying accountancy after leaving school in the 70s. As soon as he had qualified, however, he was off, joining a road haulage firm as head of accounts. He learnt a lot, he says, not least the value of a good suit, after being taken to Savile Row in the boss’s Rolls Royce and told to choose an outfit on the spot.
Suited and booted, he was on the road again just a year later, this time joining a Chartered Accountants specialising in data processing and creating software for the likes of British Beef. The interview took place in a local pub, and when he arrived for his first day he was informed his new boss had taken a month’s holiday, and he should do whatever he thought best. Eat your heart out, Alan Sugar!
Unsurprisingly, Stephen developed a taste for being in control of proceedings, and his first Company, Sapphire, a financial modelling firm, was founded soon after, winning investment, before the bottom dropped out of the market as a new industry, “Information Technology”, (you may have heard of it?) began to make brand new products obsolete on an almost daily basis. Undeterred, a few months later he found himself in Atlanta at a COMDEX conference, bidding for exclusive distribution rights for a new desktop database called Dataease, using credit cards he and his business partner had obtained in a few days, no questions asked (things were different back then), back in the UK. With the help of one or two more backers, he ended up paying £50k for the UK rights to DataEase, a ground breaking new technology that would eventually make Sapphire Group an international success, with offices in 15 countries, millions of pounds of investment raised, several companies bought, sold, and rebought, and hundreds of staff hired, and, inevitably, fired.
Stephen’s 30 year involvement with the Company, always as CEO, introduced him to the world of boardroom shenanigans, lawyers, takeovers, acquisitions, even a “shotgun wedding” merger, in 1991. Partnering with software companies in the US in the 80s and 90s must have been a pretty tough business to be in, but boy what an education! Stephen’s only regret is the Company’s shareholders not accepting a $60m offer for the Company, tabled by Lotus Development Corp, back in the 90s, before Microsoft released its proprietary database, Access, effectively ending the discussion on where the world would store its data, for the next 20 years, and counting.
What followed tested Stephen in ways he could never have imagined; managing a Company on the slide, he found, was a thankless task, but a vital one, as he attempted to wind down his operations in as productive a manner as he could. There were low moments, such as when he sat on a beach in Barbados, a faxed list of the names of hundreds of staff in his hands, and tried to decide which hundred or so to let go.
Sapphire Group is still, in fact, alive and reasonably well, but Stephen has moved ahead with the launch of the Start-Up Funding Club, incorporating the Funding Alpha SEIS fund, and it’s what we are here to discuss. Excuse the lengthy intro, but in business it is all about context! Without context, it is hard to understand that right now London and the UK is one of, if not the outright best place to invest in start-ups in the world, thanks to the launch of the SEIS scheme, which as we all know is the best thing to happen to UK based entrepreneurs since the Magna Carta was signed. Just to recap, if your investment succeeds, you pay no Capital Gains Tax on the realised gain, if it fails, the taxman pays for approximately 75% of your investment, and upfront tax relief means 50% of your investment is repaid to you via return of income tax.
Which is great, but Stephen isn’t really interested in his companies failing, he’s interested in helping them to succeed. Beginning 5 years ago with UPAD, the online lettings agency, and Emoov, the online estate agency, he has since brought together a stable of around 20 highly promising companies which qualify for SEIS status, interviewing founders, conducting due diligence, and now providing mentoring, contacts, and investment through the Fund he is a partner in.
Stephen and Innvotec, his fund manager partner, are acutely aware of the need to provide a blend of investment to help hedge risk and provide peace of mind, and thus Start-up funding club has 3 channels through which it helps companies find investment. Firstly, they invest via the fund, secondly, they run events, such as the networking event held last night at Private Members club Home House (both Stephen and Angelica look remarkably fresh, considering), and finally through Angel investment, many of whom are to be found at Funding club events. The next ones are at Home House again, (15.09), Century Club (23.09), and the Arts Club on Dover Street (01.10), by the way.
The fund, called Funding Alpha is regulated and can invest on behalf of High Net Worth individuals, although SEIS relief is capped at £100k per person. Funding Alpha takes 30% of investment gains after distributing the initial investment to shareholders, and charges the minimum management fee of 1.5% p.a. The management are hands on, but with a light touch, allowing founders to follow their instincts and grow their businesses organically, just the way Stephen likes to operate. He says he needs to be clear about 2 things: how the cash is spent, and where the sales and revenues are coming from. The products on offer tend to speak for themselves, he observes.
Stephen’s goal is to be the number 1 place for start-ups to come to for seed funding, and it’s a big, open tent, which welcomes founders of all ages, and from all walks of life. He and his team accept that not every Company will succeed, but the spread of investment is impressive, from future Tech, to the arts, musicals, social ventures, cosmetics, food and many others besides. The exit strategy timeframe is officially 3-5 years, but it’s negotiable. The goal is to create sustainable, successful, companies which deliver value for investors. Stephen knows the game inside out, he’s the role model, mentor and friend every start-up needs.
And so to Angelika, who knows better than most what it is like to work with Stephen. Well-travelled, ambitious, and with 1 start-up already under her belt, Angelika is the miss fix-it of the Start-up Funding Club, arranging the events, running the office and managing 4 handpicked interns, who are learning on the job, primed for success. Angelika is somebody who has followed her dream, from Poland to Kings Cross, via Spain, the Czech Republic, Belgium, Monte Carlo and Italy.
It was watching “Dragons Den” and reading about Duncan Bannatyne and co, that finally convinced her to try London, and perhaps it’s appropriate that she first met Stephen at the “Lions Cage” pitching event. They met for coffee, she showed no fear, and soon convinced Stephen that she was the right choice for the Funding Club. That was 6 months ago, and she has been instrumental in setting up a pipeline of business opportunities from known and trusted sources.
Reading between the lines, Stephen and Angelika are not short of business partners, and keeping them all happy is exactly the kind of job they both relish. They are problem solvers, with “an endless list” of things to do, now they have “bedded down” the Company, moving it swiftly from infancy to maturity. You’d have to get up very early in the morning to fool these two. Failure just isn’t in their nature. Business, entrepreneurship, leadership, on the other hand, most definitely are.
Stephen Page is CEO of Startup Funding Club, and Chief Executive of Sapphire Group. He is also a Director / Investor in Onfido Background Checks, Wireless Theatre Company, Friedemodin Combination Perfumery, and Chairman of Ortegra. He is an Investor in and partner of SEIS fund Funding Alpha, and has over 30 years’ experience in the Software and Tech industries.
Angelika Burawska is COO of Startup Funding Club, and a graduate of Business Administration at top European universities. She gained her experience working in different countries and across various industries, finally entering the world of entrepreneurship by founding her first start-up, Inda Platform, an online marketplace for venue based digital advertising. Her main focus today is the growth and expansion of Startup Funding Club.