Tag Archives: funding

Crowdfunding – A Cautionary Tale

“We lost 40pc of our orders because of a payments glitch but Kickstarter wouldn’t help us” : Little Riot founder Joanna Montgomery

“No one ever talks about their bad experiences on Kickstarter,” says Joanna Montgomery, the 28-year- old boss of consumer technology start-up Little Riot. “It’s seen as the Holy Grail and you never hearthe other side.”

Kickstarter, arguably the world’s most famous crowdfunding platform, has helped fund more than 100,000 different campaigns throughout its lifetime, raising $2bn for projects and products since it was launched in 2009.

It has been the springboard for many start-up success stories, from the Pebble smartwatch, which raised $10.3m in 2012 – it was seeking to raise just $100,000 – to the MaKey MaKey, an inventor kit that lets people hook up non-tech materials like Play-Doh to a computer, which raised $570,000 and is now shipping all over the world.

Welcome to Aurora – one of Scotland’s leading business angel groups

Based in North-East Scotland we offer our members carefully selected opportunities for investment. We look for companies with great ideas and bright experienced people to make them work. Our members are every-day people from all backgrounds who consider that some of their funds could benefit be invested in high-growth businesses for significant returns.

We also welcome people who are interested in helping or getting involved with high-growth businesses to join our Network at no cost and with privacy ensured). Register

Get emails on new opportunities to help high-growth companies.

Since 2003 Aurora in Aberdeen has developed a strong track record:

Members themselves have invested a total of £2 million in 20 companies
Hundreds of investment opportunities reviewed annually
Last significant investments made in 2014
Annual fee is a function of funds invested via Aurora and reviewed annually
Aurora members and Network provide expertise for executive and NXD positions

Aurora’s website Members Area describes current deals, opportunities, and declined proposals – any of which members can follow up. Find out about joining Aurora here.

If you are interested but don’t necessarily want to invest, you can join the “Aurora Network“, a free-to-join group of individuals and organisations interested in hearing about or supporting emerging companies as executives or directors.
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SEIS (Seed Enterprise Investment Scheme)

A new government incentive aims to help UK start-ups and young companies. It starts on 6th April 2012. If you are an Investor, have a look to see if this will be applicable to the businesses into which you are investing. There has been a similar incentive around for some time now (EIS) but the SEIS specifically targets new companies. The details will come out in the Chancellors budget speech next week (21st March 2012), but these are the basic points:

The business must be new, or 2 years old or less, with fewer than 25 employees. It must have less than £200,000 of gross assets and not quoted on a stock market.
Directors or executives cannot use the scheme to invest in their own companies.
You can raise up to £150,000 of funding through the SEIS, but mustn’t have already raised any money under EIS or venture capital trust (VCT) schemes. This is in total not per year.

An Investor can have up to 30% of a share in the business under this scheme. The SEIS makes it attractive for an Investor to fund a start-up because of the number of tax reliefs that they would receive:

1. Investors can claim back income-tax of 50% of the amount invested.

2. An Investor can have a ‘capital gains tax holiday’. Capital gains tax (CGT) can be avoided on any asset sold during the financial year 2012-2013 as long as they reinvest the proceeds in a SEIS eligible start-up in the same year.

3. The combined effect of the CGT holiday and the income tax break gives relief of up to 78% in the first year.

The final details are still to be published but this should whet your appetite. It’s well worth while finding out more about the scheme either to make your new business attractive, or to maximise your investment returns.