Onboard Info, a supplier of software for electronic diaries, has secured £608,000 of funding since Venturefest from a syndicate led by NatWest IT Fund and Cambridge Research and Innovation.
Founder Ray Eitel Porter puts his success in raising capital down to confidence in his management team. `We have a well-defined belief in the market opportunity and its defendability. It’s important to identify the right sources of funding: some will fund widgets, others software. We also feel it is critical to have partnerships with leading brand names, which in our case include The Economist and the AA.’
By contrast, iOra already had a product on the market but still found funding hard to come by.
Managing director Paddy Falls had raised £200,000 to produce and launch SoftCD, a CD-Rom which is remotely updateable via the internet, to distribute sales and technical information to remote users. Set up in 1997, the company sought further funding at Venturefest. Falls says: `It was a useful forum but we didn’t get as much positive feedback as we had hoped.’
Fortunately £2m was raised later from venture capital outfit MTI. Falls says: `MTI is different from most venture capital firms as it is prepared to invest a large amount at an early stage. Though we had released a product, there was hardly any revenue from it and we were looking for a large round of investment to realise the opportunities.’
He reckons there were several important factors in securing the funding. `We have expertise – the company was founded by four software engineers who in the 1980s had set up a software company which was later sold to Novell. We also have a few senior business angels on board, including chairman Mike Newton, previously MD of Dell. The market we are targeting is seen as a growth sector, and we have a good business plan.’
John Melotte of MTI says funding was forthcoming for iOra because `they matched our investment criteria. They had good underlying technology which was patentable, we liked the team, and we understood the market they were targeting. They were also at the prototype stage, which suits our investment profile.’