Fundraising made simple…..

Tinchy Stryder, who is apparently something big in the pop world these days and therefore a suitable role model, has been advising young people to invest and save wisely. I think this is a great initiative, and personally believe that lessons in business and finance should be compulsory in all schools from as early an age as possible (as apparently does Ed Balls). However, what particularly struck me when reading about this, is the fact that he partially financed his debut album by selling clothes.

In a world where everybody from pop stars to business people seem to be looking for somebody else to fund their dream, it is a timely reminder that the best way to generate cash to finance investment is to sell something at a profit and then make sure you collect the money that is due to you.

There are countless stories of entrepreneurs who have held down two or three jobs to raise the necessary funds to finance their dream and then have “bootstrapped” (i.e. used funds generated from their own business operations) their way to fame and fortune. The Beermat entrepreneur, Mike Southon, is a big fan of this approach, and it certainly saves the time and hassle of trying to find, and negotiate with, potential investors. Such an approach will require sound and disciplined financial management, but it does mean that you will have more control over your own destiny than if you allowed external involvement in your business.

I know this sounds glib, and yes of course some businesses do require significant development capital which can only be acquired through outside investors. However, I do think that some entrepreneurs spend too much time obsessing about how to raise money and lose sight of the fact that they ought to be thinking about how they should actually be making money.

Business is not meant to be easy, but it is simple, and perhaps business people of all ages could benefit from learning from Tinchy Stryder’s approach to financing their dreams.

Green Shoots? Maybe we can work it out after all….

Hooray! I have at last found those elusive green shoots. There is a landscape gardener based in Guildford who is really busy at the moment. I know this is probably an example of the DIY syndrome which normally occurs in housing recessions i.e. if you can’t move to a new house you do up the old one (although B&Q, Homebase et al should be so lucky), but normally the gardener is one of the first cuts made by a cash strapped household, so maybe these are green shoots that really have taken root. It seems that Barack Obama thinks so as well.

I met the aforesaid landscape gardener at a breakfast seminar entitled “Preparing For The Next Upturn” organised by the Surrey Economic Partnership where the speaker was the ever ebullient Beermat man Mike Southon. His presentation compared the life cycle of an entrepreneurial business with the career of the Beatles, and mixed great music with amusing anecdotal snippets and a great deal of common sense advice. Mike kept the whole audience entertained for more than an hour and I think everybody left the seminar believing that they will get through the current economic downturn, and emerge well equipped to take advantage of the upturn.

Maybe we are having a hard day’s night at present but if we can work it out and help each other rather than let it be, perhaps we will see the economy getting better in the end.

Antony Doggwiler

A battle the optimists have to win

We received an e-mail this morning from the Birmingham Chamber of Commerce seeking member views on a new BBC documentary “Recession Britain”. The aim of the programme is focus on one firm that is struggling to survive the recession and how that struggle will impact on their supply chain, particularly the smaller firms that are part of it.

My immediate thought was why don’t they follow it up with a programme on businesses that are actually doing well at the moment? There are more of these businesses around than people would think, and such a programme might provide encouragement for struggling and nervous businesses, rather than their proposed programme which will surely just exacerbate the situation.

People are more positive than is generally recognised in the media at present (witness today’s figures on consumer confidence which show an improvement since January), something that was reconfirmed at a breakfast seminar I attended organised by the accountants Smith and Williamson. Two well known names in the entrepreneurial world, Guy Rigby, Head Of Entrepreneurs at SandW and an old friend of Orchard, and Mike Southon, founder of the Beermat series of entrepreneur guides and regular FT columnist, combined in an entertaining double act to emphasise that there are always reasons to be optimistic as long as the basics of good management are adhered to.

Admittedly their optimism was tempered by a more pessimistic (or realistic? – take your pick) view from Mark Garnett, Director of Financial Services at SandW about the state of the British economy and its future prospects. OK we know it is not fun out there, and it seems that the BBC and other media take every opportunity to remind us of this. However we also all know deep down that the current economic battle is one that the optimists have to win.

Antony Doggwiler