Bill Morrow and Angels Den
I visited the “Business start up” exhibition in London last week and one of the key talks I visited was by Bill Morrow of Angels Den, which is a company matching entrepreneurs with great ideas with business peope with lots of money. I will first give some background to Bill, then his company Angel’s Den, and then the talk.
Bill Morrow, founder of Angel's Den.
The first thing which is evident from when Bill speaks is that he is a Scot and it seems to me like many other Scots very much wears his Scottishnes on his sleeves. It was from Edinburgh University, in the Scottish capital, where he graduated with a degree in business investment. He started off working for Virgin as an accountant and then went on to Morgan Chasein the City of London, Europe’s biggest financial centre, where he became chief executive.
City of London.
What was nice about Bill was that despite having such high-level credentials, we found him very down-to-earth and approachable, with some humour thrown in. He also lectures in business in the academic world in London Metropolitan University for example where he is a visiting lecturer. London Metropolitan University seems to be the only British University with a site in the very heart of the city, with their Moorgate campus.
London Metropolitan University, Moorgate campus in the city.
In his talk he mentioned that there is often a big difference between the theory taught in business schools and the real, actual, business world itself which at times tends to ignore text-book rules. I have found this to be the case with many fields, where practical experience actually means more than theoratical knowledge.
He founded Angels Den in 2004 and it is now Europe’s largest private equity firm, what means for those not familiar with the term is simply that entrepreneurs with good ideas can work with wealthy investors who provide them with money to start their businesses. In return the investors get a share of the profits. The wealthy businessmen and investors who work with Bills company are called “angels”, an interesting choice of wording as it intends to signify they are benevolent and are there to help as opposed to terms such as “sharks” or “dragons” (the word used in the hit BBC programme, Dragon’s Den). The term “angel” with its connotation of being empathetic and approachable is also better in my opinion than “millionaire”, which would create a mental barrier for some as very few people are millionaires, and not everyone knows them, and it would feel more difficult to speak to a “millionaire” than an “angel”.
I feel this is very much with the value that in my opinion Bill seemed to represent of being approachable, there to help and not to appear important and only able to be contacted if absolutely necessary, whereas the BBC programme as its title suggests is very much about the potential entrepreneurs finding a diffiult time, and grilling at the hands of the “dragons” i.e. potential investors.
The 5 questions
The five questions which any entrepreneur must address, according to Bill in his talk, are the following:
1. What is your business?
This may seem glaringly, and mind blowingly obvious, it isn’t. It gets rid of anything between a 1/4 to 1/3 of potential entrepreneurs. Simply because they cannot explain in simple terms what their business is and instead use over-complicated and long-winded language and jargon which puts investors off, who believe it or not, are very much human like the rest of us and like things to be explained in simple terms.
There is a principle of advertising called “K.I.S.S”, it is about what you do with your lips, but instead what comes out of your lips when you speak. It sometimes stands for “Keep It Sweet and Simple” (or often Keep it Short Stupid). Many people fail to pass this first question as they cannot explain in basic, short laymen’s terms what their business is about.
2. What pain do you solve in the market place?
What problem do you address, what need do you solve? If everything is fine in the market and customers are happy, why would they come to you?
3. How do you go about solving that pain?
How will you address this need, what strategy do you have or what is your solution?
4. Tell me about your competition
Bill said everybody has competition whether they realize it or not.
5. How much money do you need?
This should be a specific amount with a detailed explanation of what things the money would be used for. No investor would give their own personal, hard-earned cash to someone else without a valid reason. Humourously Bill mentioned that whereas men tend to be more vague with general figures, women are more specfic with their sums and explanation.
However Bill did say, the proposal should not merely be about details and well-written word, but should have an excitement and passion about it that would appeal to investors, as many investors do this to do new exciting meaningful projects even more so than to just make money. You will also be asked how much you think your company is worth.
Angels Den is active internationally but also within the UK with events in places such as Stockport, St Albans which is quite refreshing and admirable given the often London-centric nature of many companies, and if not London then the other major UK cities. Their successes include City Golf in Singapore, whereby two entrepreneurs in Singapore “pitched” (delivered proposals) an idea in an Angel’s Den event in Singapore. A week later they recieved just over 1/5 million pounds to realize their idea.
Another person who received help from an “angel” was Sue Acton the founder of Bubble & Balm, who has been featured in ‘The Independent’ newspaper (one of Britain’s main national newspapers) and the BBC.
Sue Acton, founder of Bubble & Balm, courtesty: Coventry Telegraph.
There were quite a number of interesting points and anecdotes which Bill mentioned in his talk. He delivered it in a straightforward manner without trying to sound too technical or trying too hard to impress. Angels Den has around 5,000 angels each of whom recieve access to Angels Den’s list of new business proposals. For a venture capitalist, Angels Den is great because it allows them to save time and find out about the best new business deals. So for instance as Bill said if an investor goes to an event and hears 8 pitches, he in reality might have heard 100 because for every 1 that is accepted a dozen or so may have been rejected, thus saving the investor time.
This touches upon an important principle.
MONEY DOES NOT EQUAL WEALTH, BEING RICH.
Ignore what I said above, lots of money does mean you are rich. However if your money stays in the bank you are actually becoming “poorer”. Why? Prices always go up. A coffee may cost £2 now (in Central London), whereas roughly ten years ago it may have cost £1, so having £2 now is equivalent to having £1 ten years ago. The same principle applies to having a $1 million (notice how I changed from pounds to dollars, why? The dollar is still the world’s main currency and this blog is for an international readership). So instead of a “millionaire”, leaving his money in a bank to decrease in real value, it is better for him to spend some of that money to gain handsome returns, doubling or tripling their initial investments, this is maybe why Bill said investors “love us”.
For all you entrepreneurs out there,(and I mean “all”, notice I don’t use the commonly used “young entrepreneurs”, why? Well, partly in the past when I used to work for a company training people to get jobs, I delivered a course called “50+”, which was for people specifically over fifty facing hurdles in the job market) I would recommend checking Angels Den out providing you have a credible business plan, a specific amount you want and don’t waste anyone’s time, most importantly yours.
Angels Den is willing to help find finance for you at a time when banks won’t, so are in some ways providing a valuable service for entrepreneurs in this difficult time. They are international including in the quickly developing gulf in Qatar for instance, which currently has huge finance available and seeking to invest. Qataris for example have bought Harrods.
Harrods bought by Qataris from the Gulf.
Etihad airways, sponsors of Manchester City football club, image: courtesyof Etihad airways
They also work with investors in the far east, and when we spoke to Bill after his talk he spoke of expanding to countries such as Tunisia and Morocco.
Their website is: www.angelsden.co.uk
Bill Morrow’s twitter is: Twitter.com/Billmorrow
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