Dragons inspire North East funding pitches

ONE of Entrust's flagship projects, the Investor Forum takes its cue from TV show Dragon's Den, with the ‘contestants' given the opportunity to showcase investment proposals to a select audience of local and national investors, as well as established entrepreneurs and leading figures from the professional services community.

The forum has now become one of the largest business angel networks within the North East, with more than 300 potential investees, and more than 60 Dragon's Den business presentations since its conception.

Since June 2009, 31 companies have been intensively supported by Entrust to become ‘pitch ready' and present to the business angel network, with these companies looking to raise finance totalling £14.8m.

So far £6.7m has been raised, with a series of forums planned throughout the remainder of 2011 to help the initiative reach its target.

The most recent forum was held last week at Northumbria University's Newcastle Business School, which saw four very different investment propositions presented to the dragons, including a production company looking to shoot a gritty cop drama on the streets of Newcastle and a company looking to roll out LED street lighting across the North East.

Among the panel of experts was Ashley Winter, the new chairman of Entrust, who believes that the ongoing success of the forum proves that there is still a strong appetite for sound business propositions, despite wider economic concerns.

Winter, who retired four years ago after a career building up the Newcastle motor company Patterson Motor Group, has taken over from former defence industry stalwart David Bowles.

In addition to his current role as chief executive of the Retail Automotive Alliance, Hexham-based Winter is also chairman of the Community Foundation Tyne and Wear and Northumberland and has previously been involved with Northumbria University, the Learning and Skills Council and Tyneside Training and Enterprise Council.

Speaking at last week's forum, he said: "The TV show Dragon's Den has helped to popularise events like this.

"The businesses that get involved have reached a tipping point where maybe they've already started to employ people but need equipment, or IT, which will take them to the next stage.

"You can see by the fact these events have such a high turnout, including accountants and lawyers, that they see it as a great opportunity.

"Entrust chief executive Dan Brophy had some difficulty keeping this event to time as there was so much interest from the group of investors, who were eager to quiz the businesses as much as they could.

"The important part is what happens in the networking session afterwards, as the investors never get enough time to ask all the questions they would like to, as well as the fact that they may not want everyone else listening to their particular questions.

"The role of the Investor Forum is more vital than ever as, not only can the businesses secure funding from the investors, they also benefit from their experience in the field of business, which is something you can't get from the banks.

"If an individual is going to put several thousand into a business, they're not going to just write out a cheque and walk away. They'll want to make sure that they get a return on their investment."

One business that has previously secured funding after attending the Investors Forum is Newcastle-based inventor Julian Peck, who received £25,000 from an investor during his pitch in February 2008 for his company Innoverce Engineering.

The company is behind the Rexel Klix staple/paperclip hybrid product, which is licensed to stationery giant Acco.

The product, which is as sturdy as a staple and does not require the use of a dispenser, has already caught the eye of a number of retailers in the US, including office supply chain Staples, which will stock the product at 1,500 of its stores later this year, while Office Depot and Office Max will also stock the product.

Previous inventions by Mr Peck include Cyclaire, a pull-cord pump for blowing up bicycle tyres and air-beds, and the VacuVin Wine Master corkscrew, which has sold more than 100,000 units.

He is also looking to build up new venture Performance Doors, which manufactures hi-tech doors for security conscious homeowners, and has once again used the Investors Forum to seek funding.

He said: "Showcasing at the Investors Forum helped to secure the funding that was needed to push the Klix product forward.

"As a result it will be sold among some of the world's biggest stationery companies.

"The forum really bridges that gap between those that have sound business ideas and the investors that can help to turn those ideas into reality."

Among last week's pitchers was Newcastle-based TallTree Pictures, which is looking to complete its funding for a feature film that will depict the problems faced by the UK's police force during the 1970s.

Harrigan's Nick was written by Newcastle writer Arthur McKenzie and is inspired by his experiences as a police officer in the city during the 1970s.

The script sees the lead character returning to the North East after fighting corruption in Hong Kong, only to find the country in a state of disarray following the miners' strikes and the decision by the government to centralise the police service and close a number of stations.

The company, which is currently planning a number of other productions, has created a solid board of directors, including Kirsty Bell, who is a tax planner and financial adviser and has raised nearly £100m in film finance, and Michael Booth QC, an IP lawyer who has the British Board of Film Classification as one of his clients.

The firm has also secured the services of established actor Stephen Tomkinson to play the lead in Harrigan's Nick, which has also helped the film to attract the investment it needs. TallTree director Vince Woods said: "We've just about to close the finance on this picture and we hope to get the green light to begin pre-production in autumn and begin shooting in the winter.

"Poor Stephen's going to be coming from South Africa shooting Wild At Heart to the lovely cold streets of Newcastle.

"Pitching at the Investor Forum was an excellent experience as it was very slick and well organised.

"It differs from Dragon's Den on TV in that the questions are a little less difficult and it's more about meeting up afterwards during the networking session to speak a bit more informally.

"There are a hell of a lot of film investors in the region, you just have to come to events like this to find them."

Another attendee was Ross Linnett, who is behind Gateshead-based Recite Me, which has launched software that helps dyslexic and visually-impaired web users to adapt websites to fit their particular preferences, translating text into more legible fonts, changing the colour contrast and reading out the content on the page.

Similar services were made available to Linnett when he was first found to be dyslexic after university, but were only available on the computer on which they were downloaded.

Recite Me intercepts the page in a similar way to services such as Google Translate, allowing users to alter sites to their tastes from any computer, tablet or smartphone without installing software.

Linnett, a former Northumbria University Student Union president, secured £100,000 of investment in December last year from Northstar Ventures through the Finance for Business North East Proof of Concept Fund, but is now looking for funding to begin selling the software into international markets.

The software, which exists in an online cloud, has been snapped up by a number of large organisations in the North East, including Gateshead Council, Northumbria University and Digital City.

The firm is now hoping that the additional investment will help it to expand its team from five to 12 staff within seven months, as well as add additional features to the software, including the ability to read out emails.

Linnett said: "Our pitch at the Investor Forum was very positive, with two investors expressing their interest, which is fantastic.

"We're looking to expand into international markets, particularly Australia.

"We haven't tried the banks for lending as it's simply a no-go.

"Banks lend against risk, so if they can take something from you, like your house, or assets, they'll lend.

"We haven't got assets, and I haven't got a house so they can't have that.

"So to be able to pitch for investment in an arena like this was a great opportunity."

Chris Knox, The Journal. (2011). Dragons inspire North East funding pitches. Available: http://www.nebusiness.co.uk/business-news/latest-business-news/2011/07/27/dragons-inspire-north-east-funding-pitches-51140-29124619/. Last accessed 27 July 2011.