25th July, 2016 No Comments
As Cavendish Enterprise begins its partnership with Crowdfunder having recently launched Cavendish Crowd (the crowdfunding resource for alternative funding for business starts and growth), it’s great to hear about the additional funding that is also in place and open to applications from eligible Cavendish Crowd clients.
Crowdfunder announced last week a deal which brings extra funding for UK crowdfunders as councils, brands and grant makers to pledge over £2.4 million on local and national crowdfunding projects. The UK’s leading crowdfunding platform is to distribute this money, traditionally given out by councils, brands and community funds via grants or sponsorship, to crowdfunding projects that meet the partner’s funding criteria. A further £1.3m is scheduled to be added to the funding offer over the next 3 months.
Projects, such as those posted on the Cavendish Crowd page, can apply for funding through these schemes, subject to eligibility, using the crowd to validate their ideas with this new route to secure additional funding and support to turn their ideas into reality.
Jason Nuttall, Head of Funding at Crowdfunder Ltd said “At Crowdfunder we believe in not only enabling people to make their great ideas a reality – but ensuring that they have access to as much support as possible along their journey. By distributing funding from partners into crowdfunding projects that have the support of the crowd, partners are not only supporting great ideas, but putting funding into projects that have also been validated by the crowd. The benefits to all are enormous, bringing fund distribution to a new level.
“National and regional partners distributing funds through Crowdfunder include Virgin Media Business, who pledged £50,000 to support start up businesses as part of the VOOM 2016 competition Crowdfunder Award, Dorset County Council who have £200,000 to support innovative youth projects in the county, Plymouth City Council, who have already turned £60,000 of council funding into over £430,000 of funds raised for their community and Creative England, who have invested £80,000 into crowdfunding film projects and £40,000 to discover and support female game developers.”
Phil Geraghty, MD of Crowdfunder added: “Council’s, brands and grant makers are enjoying some valuable benefits. They are able to easily identify projects they want to support with pledges. Partners such as Plymouth City Council have been able to amplify the money they distributed, with money raised for projects from the crowd, and also reduce administrative costs.
“Brands are also able to connect with consumers individually, and create great stories, as they help turn ideas into reality. All partners benefit from greater exposure to large-scale audiences and public engagement alongside positive success stories.”
Recently, Crowdfunder partnered with Virgin Media Business to offer crowdfunding to businesses taking part in VOOM 2016, the UK and Ireland’s biggest business competition.
Scott Wilkinson, Head of VOOM, added, “’Crowdfunder and Virgin Media Business partnered to help businesses and together we’ve turned a £50k match fund into over £700k – and it’s still growing fast.
“Crowdfunding offers a pretty spectacular option for many businesses to reach out and secure their next objective, and our ongoing partnership is helping unleash future economic successes.”
Launch your project with Cavendish Crowd and find information on additional funding with Crowdfunder Plus. Help and support with launching your project and growing your business is available to Cavendish Crowd clients through the Start & Grow programme, a government initiative for start up and growing businesses funded by the Regional Growth Fund.
19th July, 2016 No Comments
The voting is over, the results are in, and the dust is settling following the UK’s momentous decision to leave the European Union, and most people and businesses are now asking ‘What next?”. The country seems to be in a state of limbo as the overwhelming majority of citizens had thought that it would be business as usual following a vote to remain. But that was not to be. We now have a new cabinet and all eyes are on them to see if we have radical thinking or a ‘steady hand on the tiller’.
For the foreseeable future many investment decisions have been postponed, but any crisis, along with the threats it brings, also offers opportunities. The future of this country will depend on the extent to which we maximise on these opportunities, and minimise the threats. Many of us will have our own ideas of what to do, but it appears to me that what we need is a major overhaul of the way in which the country operates in order to grasp these opportunities and take bold steps to seize the chance to make the UK ‘a country of enterprise’ in the future.
It would be good to see politicians lay down a path with the least amount of obstacles in the way. With similar strong and decisive leadership, big businesses ought to be concentrating on long term plans and not the share value of today, and the banks should approve lending on all reasonable requests. Individuals need to take personal control of their futures, and SMEs should be looking at how they can make gains, maybe even at big business expense!
Back to my earlier comment about seizing the chance to make the UK ‘a country of enterprise’ I believe there’s already a real degree of enterprise around, but few people manage to realise their aspirations due to a number of factors. To unleash the entrepreneur I think the key steps are:
An overhaul of the tax system to simplify structure – take away the vast majority of the reliefs and cut the headline rates. The effect will be that businesses will find it harder to avoid paying what is due, at the same time reducing the tax burden to an acceptable level.
Rationalisation of the business support schemes available – create one national start up and growth support programme which is available to all aspiring entrepreneurs, delivered either face to face or online. Overhaul enterprise learning in schools and colleges with a National Curriculum standard at each stage of the education system (delivered at least once a week) for enterprise learning.
Invest heavily in regional road, rail, air, and broadband communications – regional investment, as opposed to major development of projects such as Heathrow 3 and HS2 will have a greater effect on the growth of SMEs and the development of enterprise than any large long term projects.
Three ideas that will not be easy to implement but this should not deter us. To take the opportunities offered by the Brexit vote, we, as a nation, need to be entrepreneurial in our behaviour – take the risk, believe in what we are doing. It will take a brave person to turn these ideas to reality as each will be opposed by vested interests, but the opportunities are out there …. as are the threats if the country slowly sink into recession.
Written by Cavendish Enterprise
3 Key Legal Considerations for Online Publishers: Copyright/Plagiarism, Defamation and Misrepresentation
15th July, 2016 No Comments
As Cavendish Enterprise trials the services of an interactive platform hosted by JournoLink which supports our Start & Grow clients in the management of their own PR and gives them access to journalists, broadcasters and bloggers, we’ve asked LawyerFair to highlight some of the legal issues around publishing content online.
This article will briefly discuss three key legal considerations which apply to the publication of material online. Firstly, the issue of copyright/plagiarism, secondly, the laws applying to defamation on the internet, and lastly, laws relating to misrepresentation online. Note, this general overview is not legal advice, and is provided for information purposes only.
Breach of copyright is a common issue which applies to material posted online, and can present significant risks for an online publisher. Broadly, copyright infringement relates to the unauthorised replication of a substantial part of another person’s work. Copyright infringement can relate to any form of artistic or multimedia work, including written materials, images, video, and sound recordings. Software code itself is also considered an artistic work and is therefore subject to copyright. Copyright arises automatically without registration, although it can be useful to provide a copyright notice in the format of © [Year], [Owner name] in order to assert your ownership.
As noted above, the test for copyright infringement is whether a substantial part of the work is taken, without a licence. Primary copyright infringement only requires actual copying, but secondary copyright infringement (i.e. dealing with or hosting copyrighted works) requires knowledge. The definition of “substantial” is a question of quality not quantity. Therefore, it is possible to infringe copyright even if a small part of a work is copied, if that part represents the “essence” of the work that may have required considerable labour, skill or judgment to create. Conversely, if a copyright work lacks originality (such as a contractual agreement using standard terms), it is more difficult to establish that copyright has been infringed.
Plagiarism could be considered as related to copyright infringement, but is more relevant in an academic context. Broadly, plagiarism is the passing off of some else’s ideas as one’s own. It may not involve copyright infringement at all, as there is no copyright in ideas, rather, copyright only attaches to the expression of ideas on a particular medium. For example, it is difficult to allege copyright infringement for stealing the “plot” of a novel (although creating an unauthorised “derivative work” is copyright infringement, such as where a novel is converted into a film). However, taking ideas without attribution could breach an academic plagiarism policy. On the other hand, if someone copies written work verbatim (rather than the idea) this would be considered copyright infringement.
A common misconception is that copyright is not infringed as long as appropriate acknowledgement of the source or a citation is provided, however, this is not the case. Quoting material in an academic or journalistic context can confuse the issue, for example a research paper can cite another paper and may reproduce sections of that paper, provided that there is an appropriate citation. The reason is not because this would not be considered copyright infringement, but due to defenses to copyright infringement, such as fair dealing and use for the purpose of criticism, reporting of public affairs, or research. It is important to note that such defences vary by jurisdiction, for example, fair dealing is called “fair use” in the USA is much broader than fair use in the UK, which is limited to a few narrow categories. Therefore, it is not wise to rely on fair use as a defence to copyright infringement.
The safest option for a publisher of online content who is wary of copyright infringement is to ensure that they have a licence to copy other materials (especially images, which can be obtained royalty-free) and to ensure that their materials are not being copied, except as permitted. For example, authors may wish to consider using a creative commons licence e.g. use with attribution (CC BY 4.0), non-commercial use (CC BY NC 4.0).
The main risk that copyright infringement presents to a publisher of online material is not necessarily the risk of litigation (which could be significant, particularly in the USA, where “statutory damages” are available for each instance of infringement or website “hit”). Rather, the main risk is that the website is taken down. In the UK, a web host can be liable for copyright infringement if they do not remove the offending material “expeditiously” if they have “actual knowledge” of infringement (see Reg 19 of the Electronic Commerce (EC Directive) Regulations 2002). If a website is hosted in the USA, it is possible to issue a DMCA takedown notice, which can force the host to remove the offending website. It is also possible to inform search engines of the copyright infringement (e.g. Google, Yahoo, Bing etc) which will lower the search engine rankings of the website.
The laws regarding defamation online are complex and also vary by jurisdiction. In the UK, the main laws involved are the Defamation Act 1996 and 2013, the Defamation (Operators of Websites) Regulations 2013, and the Electronic Commerce (EC Directive) Regulations 2002.
Defamation is divided into two aspects, libel, which is defamation on some permanent medium (e.g. writing or posting on a website) and slander, which is more temporary, such as speech, or posting on a chat or bulletin board. The legal test for defamation requires that the statement tends to lower the claimant in the estimation of right-thinking members of society generally and must have caused or be likely to cause serious harm to the reputation of the claimant (e.g. allegations that they have broken the law).
There are exemptions and exceptions, such as truth, honest opinion, public interest, and privilege (e.g. solicitor-client, judicial or parliamentary). If a publisher exerts some control over content then could be deemed a primary publisher, otherwise they could also be a secondary publisher if they passively made the content available to others. It is difficult to determine in advance what level of involvement may incur liability. For example, providing a hyperlink to defamatory article could be deemed defamation as a primary infringer, but is not clear whether linking to the home website would also incur liability.
There is a one year limitation period to bring actions of defamation (see s 4(a), Limitation Act 1980). However, the Courts have a broad discretion to extend this limitation period if they deem it equitable. This limitation period runs from the date of publication, and in the online context, each new “hit” on a website constitutes a fresh publication. However, there is a “single publication rule” under s 8 of the Defamation Act 2013 which can limit this effect. In particular, a publication by the same publisher which is substantially the same and in the same form, will not renew the limitation period.
There are additional defences to defamation relevant to to website operators. Firstly, the intermediaries defence under section 1 of the Defamation Act requires the website operator to fulfil the following conditions:
• they were not the author, editor or publisher of the statement complained of;
• they took reasonable care in relation to its publication; and
• they did not know, and had no reason to believe, that what they did caused or contributed to the publication of a defamatory statement.
Secondly, there is a “website operators defence” under s 5 of the Defamation Act 2013, which is broader. In essence, if a website operator did not post the offending article, they have a defence, provided that a notification procedure is followed under the Defamation (Operators of Websites) Regulations 2013 with specific time limits. Broadly, the complainant must send a notice of complaint to the website operator, setting out why they believe a particular statement is defamatory. The operator must contact the poster within 48 hours with a copy of the complaint, and ask them whether (a) they consent to removal of the statement and (b) whether they consent to their identification being provided to the complainant. If the poster is not available the operator must remove the statement within 48 hours. Otherwise, the poster has 5 days to respond, and can refuse consent to removal and identification to the complainant (although they must provide their name and address to the operator). In that case, the complainant will have to seek a court order to obtain the posters details from the operator and remove the statement. It is notable that mere moderation does not make an operator a poster of the material in accordance with s 5 of the Defamation Act 2013. However, the defence does not apply if the operator has acted with malice in relation to the posting of the statement concerned.
Misrepresentation can be an issue for publishers of online material, particularly where there are undisclosed conflicts of interest. For example, the fact that a reviewer will receive a commission for sales of a reviewed product via the website should be disclosed. Conversely, it is important to ensure that when mentioning other brands or trademarks on a website that there is no implied endorsement or suggestion of a commercial relationship that could be deemed trade mark infringement, e.g. including an Apple logo or branding on a website that is selling software products which are not approved by Apple.
A publisher should also be aware of consumer protection laws such as the Consumer Rights Act 2015 and Consumer Protection from Unfair Trading Regulations 2008, which outlaw misleading practices in trade. For example, an action by a trader is misleading if it contains false information or if it is likely to mislead the average consumer in its overall presentation. Therefore, a publisher making statements in a commercial context should be careful not to be misleading or provide false information.
Online publishers should be aware that material published online has legal implications. Firstly, they should ensure that no copyright is infringed and that contributors know what is permitted and agree not to publish copyright material in breach of a licence. Secondly, they should protect themselves from liability for potentially defamatory material by ensuring that they fall within the exemptions when they post the material or otherwise follow the notice procedures specified in the Defamation (Operators of Websites) Regulations 2013. Finally, publishers should ensure that they do not provide misleading statements online, particularly in a commercial context such as where goods or services are being sold.
If you require any specific assistance regarding the publication of online material and advice regarding their particular circumstances, do not hesitate to get in touch with LawyerFair.
Click here to learn more about the Start & Grow business support initiative and how you can receive the support of JournoLink (currently available in the North West, South East, and East of England) through the programme.
Written by Savva Kerdemelidis, Principal Legal Adviser at EULAW Online, and a member of LawyerFair
7th July, 2016 No Comments
Congratulations! …… but as either an investor or a fund raiser you need to do your research to understand the different types of crowdfunding and the legal issues surrounding each of them. Crowdfunding is such a new and, thus far, little understood arena, that it is impossible to give full legal advice in one blog.
However, what I can do for you is very briefly raise some of the issues that arise to give you a starting point upon which to begin your own research, or to contact a legal professional for further advice. I’ll try not to put too much emphasis on the usual caveats but that doesn’t mean they don’t hold true.
There are a huge number of articles already on the web which outline specific legal regulations and so, with a tip of the cap to the real experts – you should really check out the FCA’s own guidance – I’m simply going to try and bring to your attention some of the ‘Oohs’ and the ‘Gotchas’ that you may not have considered.
Firstly, what IS Crowdfunding?
Well actually it isn’t just one thing, and many of the biggest name crowdfunding platforms that you might have heard of actually do very different things. It’s all too easy to categorise crowdfunding as debt v equity, when there are some quite distinct differences within these categories.
Let’s explore these and perhaps attach some labels to distinguish them, before looking at specific risks and benefits attached to each;
1. Donations-based crowdfunding (Crowd-donation):
2. Reward-based crowdfunding (Crowd-reward);
3. Loan-based crowdfunding (Crowdlending); and
4. Equity-based crowdfunding (Crowd-investment).
Usually unregulated, crowd-donation is just that; a platform for a project to seek donations to further its cause. Kickstarter is one of the best known platforms for this type of project; allowing artists, bands and other creative types to seek funding to achieve their goals. There is no specific return promised or offered to investors, other than, for example, the chance to have been a part of bringing their favourite band back to life after a 20-year hiatus.
One step along are the pre-payment or Crowd-reward scenarios. In this type of crowdfunding, the fundraiser offer the investor an opportunity to receive either a ‘gift’ or a version of the product they are funding. Again, not generally regulated because these platforms are more of a marketplace. Examples include film projects offering a signed still from the production process or dinner with the director or a promise to supply investors with the first production-ready prototypes of the particular product before the general market receive them (although often at a premium).
This is peer-to-peer (or P2P) lending and is almost always regulated, whether directly or indirectly. A debt-based model of crowdfunding, the fundraiser is asking the general public (or a sample thereof) to lend them some money, on agreed repayment terms. How that repayment is structured and described can cause its own problems (which we’ll dance around a bit later) but in essence it is that simple – the investor acts as a bank and expects to get their money back plus ‘interest’.
Finally, standing squarely in the middle of a regulatory-minefield, is what most people typically think of when the phrase crowdfunding is used. In 2014, according to Nesta and the University of Cambridge, the average amount raised through equity-based crowdfunding was £199,095. Fundraisers offer to give away an element of the equity in their company in return for a financial investment. Conceptually, you might think of each platform as a mini-stock exchange for private companies, start-ups and new ventures; some genuine, others more accurately described as, ahem, ‘ill-thought through’.
Much of the actual activity covered by crowdfunding is not new – after all businesses have been seeking investment, loans or other security from private investors for many years.
What is new is the power of technology, the internet and a more investment-ready culture to accelerate and amplify the scope of these investment-seeking activities.
In the past, only select high-net worth individuals would have been plugged into these investment-seeking circles. Now, literally anybody with a laptop or a mobile phone could in theory sink their life savings into a shaky venture over their morning coffee.
This has driven the UK’s regulatory powers (predominantly the FCA) to take an increasingly involved position in the debate, with new regulations in 2014 forcing almost all crowd-lending and crowd-investments platforms to be regulated.
What are the benefits and risks of crowdfunding?
Crowd-donation and crowd-reward are usually unregulated and offer little exposure to the individual investor. Short of a slight disappointment that the specific project you funded did not happen or the gadget you pre-ordered failed to arrive, the potential for loss is usually limited.
Be warned though, there can be tax-traps for the unwary, as donations may trigger an income or corporation tax charge. Sending a shiny reward back the other way, whether or not it was asked for or anticipated, will almost certainly be treated as a VATable supply, unless it isn’t – and it really will depend on the specific circumstances, so make sure you consider this in advance.
Crowd-lending (eg Funding Circle) is actually the fastest-growing form of crowdfunding, with some estimating that it might be a £12bn market by 2030 and £749m of business loans created in 2014 alone.
Now regulated by the FCA, platforms must;
(i) hold minimum capital reserves.
(ii) keep separate their own money from that of investors.
(iii) have contingency plans in place to maintain payments in the event that the platform goes bust.
(iv) be much more explicit about the risks involved with crowd-lending – a regulatory reaction to the earliest platform promises of these loans being equivalent to a bank account.
For the business seeking investment, the obvious benefit is quite simply the opening up of a seemingly untapped and unlimited market of funders who might be able to support their venture; where traditional bank loans may not be available.
Another opportunity is the emerging trend for revenue-sharing repayment, where the original loan is capitalised and repaid at the end of the loan period (or in some cases not repaid at all) in return for the investor receiving a share of revenue, rather than a fixed interest payment. This mitigates the cost of servicing the loan in instances where forecasted revenues are lumpy.
Drawbacks, outside of the usual ‘can the loan be serviced’ question, centre on the strength of the platform to actually achieve a successful loan placing and the cost of any fees payable to the platform itself, both on entry or exit of the loan. From a tax perspective, the loans will be generally treated as any commercial loan, with the relevant corporation tax write-offs and balance sheet treatment as a bank loan.
For the investor (lender), crowd-lending tends to be slightly lower risk than crowd-investment and fewer regulatory hurdles apply. The risks mainly centre on the lack of sophistication that ‘crowds’ are likely to have compared to institutional lenders such as banks. The lender is therefore relying on the platform to consider things such as anti-money laundering, credit checks and scoring to verify the viability and provenance of the business seeking funding.
Even then, given that most businesses turning to crowdfunding are start-ups, these loans are inherently riskier than leaving your cash in the bank and recent FCA complaints have highlighted the lack of honesty in some marketing material provided by crowd-lending platforms. Admittedly this was part of their pre-regulatory research and it is possible that the ‘bad apples’ are being weeded out.
Nevertheless the lender must consider how plausible any claims of revenue forecasting or credit viability are, whether made by the platform or the business itself along with the availability of any assets or security that the lender could use if the business defaults.
Remember that platforms are inevitably in a slightly conflicted position, as they are usually generating their fees based on successful loans placed, which has in the past caused some of them to underplay the severity of the risk of these loans not being repaid.
New changes in 2016 which enabled investors to lend money through a tax-efficient ‘innovative ISA’ scheme have been fraught with delays but do represent attempts to recognise the new wave of lending. They are expected to provide a major boost to the Crowd-lending fraternity, however it is too early to evaluate their real impact .
Crowd-investment ….. and finally, the equity play. This is where things get really exciting, complicated, and impossible to neatly summarise. You have to consider both the regulatory impact of the FCA (the platform should be FCA regulated) and the impact of the Financial Services and Markets Act (FSMA) which regulates the type of shares that can be offered, and to whom.
For the business seeking investment, the advantages of crowdfunding include:
Access to a much wider pool of investors (although see below, be careful it is not too wide);
Generally involves giving away substantially less equity per £ invested than a traditional angel or private equity round, largely because no one investor is investing enough cash (or perhaps has the relative sophistication) to value the venture accurately;
Limits the control given away – for example where an institutional investor may require a larger slice of the equity and insist on a seat on the board; individual crowdfunders are unlikely to have the sophistication, or the inclination, to demand this;
The process itself may generate publicity/marketing for the new venture (which may also have drawbacks, see below);
Harnesses the ‘herd’ effect – if you can gain traction on a crowdfunding platform there is a real possibility of the ‘me-too’ mentality (technically known, I believe, as ‘FOMO’) that can generate larger-than-expected investment pledges
Downsides perhaps mirror those of any equity investment, however for the unsophisticated start-up, particularly one without a seasoned advisor, this may be a regulatory minefield – with potentially criminal sanctions for getting it wrong, even if much of the burden is passed to the platform. In particular, businesses should consider the following:
Have you vetted your chosen platform to ensure it is FCA regulated?
Assuming yes (and if not, run), make sure you are not guilty of ‘financial promotion´ – a criminal offence which centres on attempts to offer shares in a private business to the general public? (platforms often get around this by inviting people to become ‘members’ of the platform, limiting the scope of who gets to see it).
Are you in a position to produce and provide clear information, prospectuses, forecasts and investor materials? These must adequately and accurately highlight the risks of investing in your business.
Are you going to give away valuable intellectual property by showing information on the platform/website? Unless you have protected your product (ie trade marks, patents, design rights etc) you run the risk of competitors stealing your ideas. Even if you have protected them, there is still a risk of copying taking place, so be prepared.
For the investor information asymmetry is the major flaw in the crowdfunding model, from an investor’s perspective. While these platforms open up a world of investment opportunities to the general public, many of these potential investors will not have access to the kinds of tools, information and experience that an average institutional investor has to hand.
And so the potential benefits are huge – you could make a strategically tax-efficient investment in the next Trunki or Facebook.
Prior to regulation the FCA highlighted major risks with some platforms over-emphasising the benefits of crowd-investment while seemingly ignoring the risks, often by omitting or cherry-picking the information provided.
Regulations do exist to try and mitigate this by restricting the pool of people that investments can be offered to. This is where it gets really complicated and in truth, outside of the scope of this note and one for the platform to wrestle with, rather than the business itself. In brief they often involve the platform requiring investors to ‘self-certify’ themselves as either a high-net worth or ‘sophisticated’ investor (capable of spending their money as foolishly as they please) or a ‘restricted’ investor.
Investments to restricted investors (Joe and Joanne Public, essentially) often involve a cap on the amount raised or the individual amounts invested, either in real terms or as a % of the investor’s assets.
There are significant tax advantages to many of the investments available on crowdfunding platforms, being new startups. These include Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) reliefs. Investments attracting this relief benefit from an immediate income tax reduction between 30% – 50% and a reduced or zero obligation to pay capital gains tax when the shares are sold.
Although not directly benefiting the businesses looking for funding, these schemes are so attractive to investors that they can mitigate the riskiness of crowd-funding, leading to increased funding being achieved.
The tax treatment of investment will again be the same as any equity round, with corporation tax and implications dependent on the particular business, its profitability and success.
Conclusion and other thoughts
From a legal perspective, particularly for the business seeking funding, it is important to remember that there are likely to be two key relationships governed by terms and conditions that must be checked.
First is your relationship with the chosen platform. How does this govern fees, risk, obligations over regulatory requirements and enforcement of any failures on the part of the investor/lender.
Secondly is your relationship with the ultimate investor/lender. What credit or other checks have been carried out. What implications are there for future investment rounds or repayment obligations and are there any obvious tax implications that have been overlooked.
Overall, the great opportunities afforded by crowd-funding of all types are starting to become apparent.
However, it is impossible to conclude an article like this – however frustratingly – without liberal use of phrases like “it really depends on the circumstances”, “speak to a grown-up about tax” and “make absolutely sure that you don’t accidentally engage in financial promotion by offering your shares to a global audience and end up in a US jail”.
Written by Richard Turner of Alt Legal Ltd on behalf of LawyerFair
Launch your project to raise funds for your startup or growing small business with Cavendish Crowd – the crowdfunding platform specifically supporting small businesses across the country.
Click for downloadable document giving overview of the legal considerations to undertake when considering crowdfunding, either as an investor or a fundraiser.
Contact Richard if you have any legal questions about crowdfunding.
Cavendish Enterprise has teamed up with Crowdfunder Ltd to bring Cavendish Crowd to startup and growing small businesses across England. Crowdfunder Ltd carries out equity crowdfunding activities through its associate partner Crowdcube Capital Ltd, which is authorised and regulated by the Financial Conduct Authority (No. 650205).
Alt Legal Limited is part of Alt Professionals – providing joined-up professional support for SMEs across legal, financial, HR and advisory services, under one roof.
4th July, 2016 No Comments
Seaweed & Co. Ltd was established in 2015 to advise on, supply and accredit superb seaweed for the food, health and nutrition markets. In this time, the company has established a global distribution network, and world-class production that is proving its seaweeds to be the best on the market.
Above : The Outer Hebrides where the seaweed is grown and harvested.
Dr Craig Rose, Managing Director of Seaweed & Co, explains how the business support he has received has helped his enterprise to grow as rapidly as the seaweed it harvests.
“Establishing a business in an emerging industry presents its own very unique challenges. It takes a great deal of patience during the early months to educate and inform potential customers who don’t yet know about the potential of seaweed. At Seaweed & Co. we are not only trying to sell our own products but also work alongside other companies in our field to grow the industry as a whole.
“As a business owner this means that I had to go into the start-up phase with my eyes open. I knew there would be a significant initial outlay on equipment – such as the state-of-the-art technologies we installed – and my forecasts had to reflect the fact that we wouldn’t be selling thousands of pounds worth of produce from day one.
“With high set up costs and little awareness of such a niche industry, a new business like Seaweed & Co. requires access to both investment and proactive business support. And that was why I took the decision to approach TEDCO.”
TEDCO is the Cavendish Enterprise partner delivering business advice and support in the North East.
Dr Rose continues “I was already aware that TEDCO had a strong reputation for start-up support and when I first contacted business advisor Bill Hartshorne, he very quickly understood where we were and how we might look to meet the challenges and opportunities that we faced.
“One of the key things that I was able to get help with straight away was funding through the Virgin StartUp Loans scheme. We were delighted to be awarded the maximum possible loan of £25,000, which enabled us to get the new technologies in place. Thanks to the marketing teams at TEDCO and Virgin StartUp we were also able to generate substantial press coverage through the trade press, newspapers and even BBC news.
“As part of the Start & Grow programme, Seaweed & Co. also benefitted from the one-to-one support of a business advisor, which is ongoing for up to three years after start. With the help of Bill Hartshorne, we were able to ensure that our business plan was up-to-scratch and that we had the right plans in place to grow the business once we had funding in place.
“Less than two years later we have a truly world-class and highly unique product offering that is now being sold around the world. But our relationship with TEDCO didn’t stop after those early few months. We have continued to work closely with them and the wider Cavendish Enterprise team to promote the business and realise our ambitions.
“In June 2016 Seaweed & Co. was one of just three companies from around the country selected to talk at the House of Lords. This event, a Celebration of Enterprise, was organised by Cavendish Enterprise and sponsored by Lord Wei of Shoreditch.
“It was a huge honour to be able to speak at the highly prestigious House of Lords, to an audience of invited guests that included some big names in the business and business support world. This type of exposure is only possible through the on-going support and networking opportunities made possible through TEDCO and Cavendish Enterprise. With their help we have been able to raise the profile of seaweed, as a natural and sustainable British resource that both benefits people’s health and the health of the planet.
“In starting a business there are many uncertainties, risks, time constraints and demands on resources. It was genuinely helpful to work alongside a support agency that understood the complexities and challenges of a start-up business. From the very beginning, both TEDCO and Cavendish Enterprise have continually provided a high quality business support offering, with a genuine interest in the business and a desire to see us succeed.
“I would highly recommend any business to make contact with a business support agency, and to see where it could go. It was one of the best decisions I made when starting out.”
With thanks to Dr Craig Rose, Managing Director, Seaweed & Co for his informative insight into starting a business.
More information on Seaweed & Co., and the immense benefits of seaweed, can be found on their website.