Spotting future potential in a business

Introduction

Not every business that is introduced to Maven will be investment ready. In turn, we don’t always expect every business to be the finished article. As one of the UK’s most active investors in growth companies we also look at future potential and whether a potential investee has a clear, credible business strategy that is capable of delivering growth in profit and earnings.

Watch Tom Pickersgill, CEO at Orka Technology, and James Darlington, Investment Director at Maven, discuss the helpful 12 hour support programme Maven runs as part of it management of NPIF Maven Equity Finance and how the initiative helped Orka make tangible progress against its commercial milestones and ultimately receive equity investment to accelerate its growth.

Transcript

James: We do invest in pre-revenue businesses, so in terms of our Northern Powerhouse Investment Fund whereby we've done about 65 investments, I'd say about five to ten of those have been pre-revenue businesses.

The interesting one with Orka is they actually moved on to our 12-hour support so we saw the market opportunity and we liked the business, but it was a little bit too early for us.

Tom: Maven came on board and supported us with 12 hours of support so that was to understand the business and put some basic pieces in place before they came aboard and invested into us, and so I spent time with Jim putting models together, creating marketing collateral and stress testing our assumptions.

James: During that 12 hours of me working alongside Tom whereby I was sort of helping him build his financial model and trying to accurately forecast the next three years. Tom will probably profess and hold his hands up to admit that financials are not his strong point and during that time I thought getting to know Tom a little bit better. I think from my perspective I just understood the total addressable market but also the opportunity that was in that market.

Tom: To be fair to Maven, they did take that gamble with us and suppose it backed me as a person more than anything. If there's no revenue coming through business, it is commendable really, because the northwest venture capital scene isn't something that usually does something like that.