Our chief honcho Gavin talked at an event today about the finance-raising journey that we’ve followed as we prepare to launch our car insurance market-disruptor.
I participated on a panel discussion this morning organised by Digital Union and Business Durham with Zoe Farrington from Real Safe Technologies and Aidan Dunphy of Hedgehog Lab. The topic was funding journeys of digital start-ups in the North East. The interesting point reinforced by today’s discussion is that there is never a common journey. Each business’ requirement for capital, back story, founders and product means that each raise is unique. The elements that are consistent revolve around the ability of the founders/management to clearly present the idea and the opportunity in a way that can be understood by investors without a specialism in the domain area, whilst also conveying their utter dedication to the idea. A great business plan is therefore hugely important and should be the first step in the funding journey for aspiring businesses.
honcho’s funding journey has been incredibly varied, with investments from high net worth individuals, regional European funds, mainstream VCs as well as hundreds of crowd-funders. That journey would not have been possible without first having gone through the process of crystallising our product, opportunity and approach in the plan. The process forces you to look closely at all aspects of the business from a point of view that is often missed when in the thick of it. Once complete and successfully used to raise funding, it should be referred to regularly to remind the business where it is going and how it was proposed to get there. Any deviation can then be considered and accepted or rejected with the same clarity. The good news for honcho is that we have not markedly deviated from our plan, although the timeframes have inevitably been longer than predicted.
The moral of the story? Once you have that brilliant idea, write a brilliant business plan to communicate it to potential investors, then go for it.