Learn how a public investor views funding for a creative company
Mark Fenwick (Creative & Design Fund Manager, NStar Finance) gives us an overview of how public investment systems and structures are changing … moving away from grant funding and into investment oriented structures in order to achieve a commercial return on the monies invested.
If you’re considering looking for investment here’s a view from the investors perspective … which is useful as you’ll learn what the specific needs of the investor are.
Monies invested from the public purse are governed by very specific restrictions on the amount and ways in which investments can be made – for example State Aid rules limit investments to 200,000 euros. By finding other investors who will co-invest alongside NStar, it’s possible to raise the value of the overall sum invested to perhaps £300k of equity plus £50k of convertible loans … not a bad result for a first round investments in a Creative Industries SME. In exchange for this NStar is looking for a return on investment in 3-5 years.
Mark also talks about his perspective on equity dilution, the sectors the fund focuses on, the very particular challenges these funds face and thus the way they operate.
Investment Matters, British Embassy, Brussels, 2008 – courtesy of CIDA and the ECCE programme
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To read more about what NStar were looking for in investees download a copy of MIND THE GAP. To read about how the crowd in Finance Yorkshire (previously called SYIF) are planning to improve connections to the Creative Industries read the executive summary, Report or recommendations.
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