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Summer 2014
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Summer 2014
Innovating here, expanding overseas
At Midven, we have been tracking a trend in our portfolio: companies whose progress may be stifled in the UK, but which are achieving successful traction overseas.
 
Many of our portfolio companies thrive internationally.  Simworx, based on a trading estate in the heart of the Black Country, have emerged as world leaders in the development and design of 3D and 4D simulation attractions at some of the biggest theme parks in the world. Cobalt Light Systems has been supplying airport security screening products around Europe and recently was honoured with a Royal Academy of Engineering award – another example of the UK leading the way overseas.
 
But why do British companies – start-ups as well as more established companies – often find it easier to meet their expansion plans by tapping into new markets abroad rather than in this country?
 
As Tony Stott examined in his blog “Is the UK open to innovation?" some of this is caused by cultural issues and some of this is structural. Culturally, a frequent impendence is that Brits can be a pessimistic bunch, resistant to change and unwilling to take a risk on a new product supplied by a small company (in case it does not pay off). This attitude is encapsulated by government procurement rules, which often state that a company must have a minimum turnover of £5m before it can tender for government work. But is not just the government that has this attitude as the old adage “Nobody got fired for buying IBM” is prevalent across many organisations.

In the US and the Middle East, these cultural issues do not seem to apply to the same extent. These regions often don’t have a ‘this is the way we have always done it’ approach and are less risk adverse. Structurally, the UK market, for many products, is dominated by a few large businesses. The five largest retailers have all the power in such a relationship. They control 50 per cent of all retail spending in the UK and if you have a successful product will either copy it (own brand) or negotiate the price down to such a level that you cannot make a good profit.

However, in the US there are many more medium-sized businesses, which might be strong in a few states, but not necessarily nationally. Many of these businesses maintain a strong bond and brand with their local communities, are still owner-managed, and are open to innovation.

So, whilst the UK is clearly open for business, we encourage many of the companies in our portfolio to export. It is not easy, there are challenges, but often it’s the only way for a small innovative UK company to grow rapidly.
Our recent investments
Tapping into the university student market - £15b and counting
A young and passionate management team is behind Uni2, a company which is offering a helping hand to students across the West Midlands.

Uni2 publishes a trend-setting magazine and offers a range of services for students including help finding accommodation, discount cards, events and excursions, and student packs.
Midven’s Early Advantage fund has backed Uni2 to help them develop their business in the region. With more than two and a half million students currently in higher education in the UK and an annual spending power of £15.5 billion, Midven’s Aanisah Begg comments that the student market is a largely untapped sector with huge potential for growth.  
Healthy prospects for innovator looking to expand
An online platform which helps families and carers better support poorly relatives has secured investment of more than £200,000 from Midven and other business angels.
 
Staffordshire-based Health2Works' “Rally Round” app affords the ability to co-ordinate practical help for ill family members.
 
The firm has also created “Ollie”, an interactive tool for paediatric speech and language therapists.  Midven investment executive John Slaughter said the company had a great combination of innovative products and a genuine benefit to patients which should help to reduce admissions to residential care facilities.
Investing in defence and security 
Defence and security have been uppermost in many people’s minds these past few years.

New Midven portfolio company Amba Defence delivers bespoke services to national infrastructure, national and international governments, private institutions and high net worth individuals.

An investment of more than £250,000 through Midven’s Exceed Fund will help the company expand its innovative defence, security and safety equipment, and monitoring services, as well as recruit additional staff to support the organisation’s growth plans.

“The investment is timely as we are at a stage where we are ready to grow the team and the business and move the organisation to the next level”, said Amba managing director Shires Crichton.
Thinking ahead as firm plans for future
An £800,000 investment from Midven and other private investors has provided a boost for the data centre software specialists Concurrent Thinking.

The company has developed high-performance products which drive significant reductions in energy use and carbon emissions in data centres.  New chief executive Terry Hale said the funding gave the company a route to building its team and sales strategy, which are the next key steps in the firm’s growth.
Investing in colour vision technology
Spectral Edge has received £300k from Midven’s Rainbow Seed Fund and other investors. The University of East Anglia spin-out exploits novel image fusion technology and is pioneering new approaches to image fusion, colour perception-based processing and image enhancement. Spectral Edge technology enhances images and video by using information outside the normal visible spectrum. Applications range from medical imaging and surveillance all the way to consumer applications such as enhancing camera images and TV pictures. 
Events

Social Media Workshop: 
Business strategies beyond Twitter and Facebook

On June 10, Midven hosted an engaging discussion on customer engagement, industry visibility and thought leadership.

Speakers Javan Bramhall of Digital Glue and Jennifer Edwards of Midven shared tried-and-tested social media strategies to help reach, engage and drive action from customers through social media. A number of Midven portfolio companies across various B2B and B2C sectors contributed detail on how they successfully leverage social media channels to communicate with key partners and customers.
View  the video or access the social media slides here. 
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National headlines
Tony gives ‘survival’ advice to entrepreneurs on
The Guardian 

Midven chief executive Tony Stott took part in a live Q&A discussion for The Guardian that focused on surviving the first year as an entrepreneur.
Tony was one of a panel of experts made up of senior business people who offered advice on start-ups pitfalls, as well as practical thoughts on how businesses can best survive that vital first 12 months.
Questions included the various approaches between small and large companies, personal hardships endured in the first year, what drives people to become entrepreneurs, regulation and red tape, as well as panel responses to the question: “What was the best piece of advice you have ever been given?”
It made for a fascinating session – you can see it captured (including Tony’s input) here.
and Roger bangs the drum for our region
Tony was not the only Midven director making the national media recently. Roger Wood wrote an article for The Guardian explaining why the Midlands is the Hub of Enterprise and ripe for start-ups.
More new businesses were created in Birmingham last year (over 16,000) – than anywhere else in the UK outside the South East. Roger contends that the Midlands – which made its name as part of the Industrial Revolution – has undergone the dynamic change necessary to equip it to be a powerhouse of innovation set for continued growth in the 21st century.
You can read his article here and see more on Midven’s Hub of Enterprise initiative here.
Rainbow Seed Fund expands team
The burgeoning Rainbow Seed Fund has secured a coup by making two key appointments.
With both commercial and academic expertise, Oliver Sexton will play a major role in identifying companies with great potential in the field of synthetic biology, which uses engineering principles to improve natural products by combining rational design with our knowledge of how individual cells, organs and plants live.   Before joining Midven, Oliver managed investment and licensing at Bio Engineering Technologies and previously worked in a UK biotech focused on gene medicines. 
In addition to Oliver’s appointment, Rainbow Seed Fund's advisory board has added Sean Sutcliffe, who is chief executive of renewable sector leader Green Biologics.
 

Watch Rainbow Seed Fund's synthetic biology video here.
And finally……
The World Cup tournament may not exactly have gone how England would have wished, but we were determined to have some fun here at Midven. Around 100 staff and representatives from our portfolio companies took over the mezzanine floor of a city centre bar, and watched Roy Hodgson’s men battle out a 0-0 draw with Costa Rica. We may not have seen many (any!) goals, but it was a great networking opportunity and we got the place buzzing on a fine summer’s night.
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http://www.midven.co.uk
Email: enquiries@midven.co.uk
Telephone: 0121 710 1990
Fax: 0121 710 1999
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