In our latest guest blog, Warren Knight, CEO and Founder of Gloople talks about the challenges in securing early stage funding and the tax break that can help…

Many businesses like ours face challenges in funding the early stages of their growth. With ever tightening bank lending, founders must often rely on a wide pool of capital – from convincing friends and family of their vision, successfully pitching their business to Angel investors or Venture Capitalists, or completing time-consuming applications for public grants.

Around 12 months ago, we ran into a funding roadblock. Until that point, we’d built Gloople into a successful e-commerce platform which creates online shops for small and medium sized businesses giving them a visible online presence and additional channel to target customers. We’d created 20 online bespoke stores for small and medium sized businesses including Megan Brown and Bicycle Richmond.

We’d set our sights on reaching greater numbers of users, and support growing numbers of small and medium sized businesses in reaching reach more customers. We describe ourselves as free for small businesses with big ideas and simply the easiest way to create an online store. To achieve our ambitions, we needed to continue to invest, to develop our platform, improve its functionality and increase its integration with social networking sites including Facebook.

Raising this investment was no easy task – an experience many ambitious companies like ours can no doubt relate to. Over the next nine months, we explored various options ranging from going to our Bank to high-net worth investors but without much luck. We eventually identified a partner to help us achieve this aim, and worked closely with Conduit Consultancy to guide us through the investment cycle and boost our chances of success.

With their input, we accessed funding available from the Seed Enterprise Investment Scheme (SEIS). It has been instrumental in helping us get to where we are today. Through the scheme, we’ve raised £150,000 in our latest funding round, with all but £20,000 of it coming from a London Business Angels syndicate who put the capital up as a SEIS investment.

This has provided us with the fuel our business needs to succeed by bringing in the right talent and developing our product, for example by building an easy stock and payment system for customers. As a result our business has grown to more than £1 million in less than two years.

SEIS in my view is a bit of a hidden gem. I want to see more founders talking about it – we need to remind angel investors of the tax relief that’s uniquely available here. Do that and we’ll see more investment come our way. 

The tech sector in this country offers fantastic opportunities for founders with passion and great ideas. London is home to some amazing talent, but we can do more to help build the reputation of the UK as one of the best places in the world for entrepreneurs to start and grow successful businesses.

For more information on SEIS, go to http://www.hmrc.gov.uk/seedeis/index.htm