City of london corporation to generate over £10 million a year of angel investment to propel growth of tech city

26 October 2011

Today, at an event hosted by Stuart Fraser, Chairman of the Policy and Resources Committee, the City of London Corporation announces the launch of a new flagship scheme, Angels in the City. Delivered in partnership with London Business Angels, the scheme aims to generate over £10m of new Angel investment per annum to further power the growth of Tech City and boost other entrepreneurs in the surrounding areas.

Tech City is home to one of the largest concentrations of small, fastest-growing digital technology companies in Europe. Tech City, the Government-backed area which includes Old Street, Shoreditch and extends out to the Olympic Park in Stratford, is already home to a cluster of over 500 high-growth potential SMEs.

The Angels in the City scheme is part of the City of London Corporation’s ongoing commitment to supporting SMEs and boosting London’s global positioning as a leading entrepreneurial centre. Since 2010, the City of London Corporation has invested over £1m in supporting small businesses in its neighbouring boroughs.

 

Delivered in partnership with London Business Angels, the City of London Corporation’s new scheme aims to recruit and build the capacity of a new pool of 125 new Angel investors, drawn from the Square Mile, the UK’s financial and business epicentre. Through Angels in the City, it is anticipated that over 40 Tech City businesses and similar technology-focused start-ups in the surrounding areas will benefit from Angel investment each year, creating around 200 new jobs per annum. With the scheme running initially until March 2013, it is envisaged that the level of investing will continue to increase as the pool of City Angel investors grows over the years ahead.

Stuart Fraser, Chairman of the Policy and Resources Committee, says, “Through supporting the growth of Tech City, and the development of similar technology companies, the Angels in the City scheme will help to maintain the City’s positioning as an international business centre, in turn encouraging economic prosperity across the UK. The City needs to be insulated by innovative businesses who can supply the Square Mile with the tools and resources it needs.”

 

The City of London Corporation is both funding and supporting the pioneering scheme, by promoting Angels in the City to its extensive range of City contacts in order to identify potential investors who will then be invited to participate. Participants will benefit from a rolling programme of workshops and roundtable events taking place over the next 18 months, providing insight into the investment process, risks and rewards, and how to take advantage of tax breaks with experienced investors offering top tips.

Once ‘Angel ready’ participants will be invited to pitching events; where London Business Angels will facilitate face-to-face meetings between these new Angel investors and innovative entrepreneurs from Tech City and the surrounding areas. Three pitching events are already scheduled for May 2012, November 2012 and February 2013.

Stuart Fraser, Chairman of the Policy and Resources Committee, continues,“The City of London Corporation’s new scheme will unlock the City’s potential capacity for Angel investment. Angels in the City will leverage the financial capacity of individuals from the Square Mile and their core business experience, channeling this expertise into innovative start-ups in Tech City and the City fringes.”

The Angels in the City scheme is part of the City of London Corporation’s wider commitment to supporting burgeoning businesses in and around the Square Mile, including Tech City-type start-ups. Programmes include:

  • Innovation Warehouse– the City of London Corporation has partnered with some of the UK’s most successful serial entrepreneurs to establish a pioneering business incubator in Smithfield which nurtures high-potential new ventures. Having opened its doors in June of this year, Innovation Warehouse provides workspace to largely technology-focused start-ups. In addition, it offers access to investment, training and business mentoring – all within a communal environment, encouraging a free flow of information and peer-to-peer support.
  • Ready to Supply the City– this programme helps SMEs in the City and surrounding boroughs become ‘tender ready’ and increase their share of the £13.3 billion City supply chain.
  • Local Procurement Charter– the City of London Corporation’s Local Procurement Charter requires developers to procure at least 10% of its services locally.

Eric van der Kleij, CEO of the Tech City Investment Organisation, says,"Angels in the City is directly sending a welcome message to City of London and other investors to roll-up their sleeves and work with us to help create the next generation of tech and digital growth businesses right here in Tech City. Generous tax incentives available through the Enterprise Investment Scheme, Entrepreneurs Relief, and R&D Tax Credits help to boost confidence among both entrepreneurs and investors alike. It's the right time to start and invest in young tech and digital businesses."

Laurence Kemball-Cook has successfully accessed Angel investment during 2011 to support the growth of Pavegen Systems. Based in the City fringes, his business has developed an innovative floor tile technology that converts the kinetic energy from human footfall to renewable electricity. Laurence says, “London is a mecca for innovation, there are so many start-ups in and around Tech City who represent a huge opportunity for investors. We only recently secured Angel investment; the process was tough but the injection of funds was vital in order for us to move the business into the next stage, enabling us, for example, to up-scale our technology to fulfil existing client orders for our kinetic footfall technology”.

“The launch of the Angels in the City scheme is helping to open up the niche Angel community, and the investment opportunity it offers, to those who may not even be aware that is exists. In turn, an array of other high-growth potential start-ups may be able to benefit from Angel investment, like Pavegen Systems has, and actively grow their businesses.”

Angel investor Sandy Black says,"I became an Angel investor five years ago, when larger scale private equity investments became too expensive and hard to find,whereas Angel investment offered higher rates of return, albeit over a number of small investments. I currently support around 15 small businesses to varying degrees and typically invest between £30k and £150k per enterprise. Whilst I come from a legal and financial background, for those without this kind of experience or particular technology or service expertise, there may be some barriers to becoming an Angel investor. For example, the cost of legal and other due diligence advice can be disproportionate to the amount being invested. The Angels in the City scheme will help potential Angel investors overcome such barriers as they will be able to pool their money and expertise through associations such as London Business Angels’ EIS Roundtable Syndicate Funds."

For further information regarding Angels in the City, please refer to the website: www.cityoflondon.gov.uk/angelsinthecity

For further information and enquiries: 

 

FOR PRESS ENQUIRIES, PLEASE CONTACT:

Hannah Adamor Jan Vigneswaran at Rain Communications

T: 020 7828 0118

E: firstname.surname@raincommunications.co.uk

London Business Angels
Anthony Clarke, Managing Director
Tel: +44 (0)20 7321 5672
E-mail: enquiries@lbangels.co.uk
Web: www.lbangels.co.uk

About London Business Angels

LBA is one of the most experienced private angel networks in the UK. Since the early 1980s the network has been connecting innovating fast growth small and medium sized enterprises with investment through our network of business angel investors. LBA, part of Angel Capital Group, is professionally managed by a highly experienced management team, leveraging over 15 years’ experience in the early stage investment marketplace as established leaders in the development of new angel-led early stage investment initiatives, and nearly 30 years’ investing experience through the LBA network. LBA is a founding member of the British Business Angels Association, the industry's best practice trade association, and is also a member of EBAN, the European Business Angels Network.

About the LBA EIS/SEIS Approved RoundTable Syndicate Funds

The LBA EIS Approved RoundTable Syndicate Fund is the culmination of 30 years’ experience of pioneering innovation in the UK Angel investment market. This FSA regulated HMRC Approved EIS Fund offers LBA Investors an innovative way to acquire a portfolio of investments, while taking advantage of the personal tax relief offered by the Enterprise Investment Scheme. The First £300k LBA EIS RoundTable Fund 2010 was fully invested in January 2011, making four investments in leading edge technologies during the previous year, spread across a range of sectors: Eykona (medtech); Syrinix (cleantech); ipadio (mobile); The Electrospinning Company (nanotech).

Following the successful 2010 Fund, the LBA EIS Approved RoundTable Syndicate Fund 2011-12 closed for subscriptions on 13 May 2011, being 40% larger at £420k. The fund invested in 5 leading edge technologies spread across a range of sectors: Camstent (medtech), Momentum Bioscience (medtech), Phase Vision (high value manufacturing), Michelson Diagnostics (medtech), Isotera (cleantech)

The LBA EIS Roundtable Syndicate Fund 2012, closed for subsciprtions on 5th April 2012 at £455k. The fund invested in 6 early stage companies.

The LBA EIS Roundtable Syndicate Fund 2013, closed for subscriptions on 5th April 2013 at £290k. The fund invested in 6 early stage companies.

The LBA EIS Roundtable Synducate Fund 2014 closed for subscriptions at £695k on 4th April 2014. The fund will seek to co-invest alongside London Business Angels in the next 12 months

The LBA SEIS Roundtable Syndicate Fund 2012, closed for subscriptions on 19th October 2012 and will seek to co-invest across 6-7 SEIS eligible deals alongside LBA investors