Investors look for a stake in your business as they share the financial risks by providing equity rather than loan capital.  They depend on the success of your business to be able to recoup their investment.
 

Business angels are individuals who invest in a business in return for a stake in the company.  They tend to invest between £10,000 and £100,000.  Business angels can be contacted through SWAIN or the National Business Angels Network.  For local contacts see Business West.  They are best attracted if you can show that your business can offer an attractive return, but you must be prepared to relinquish some control.  They also want a seat on the Board. 
 

 
Private equity firms are able to invest from £100,000 to several million pounds in companies at different stages of development, although expansion is the most common.  They will tend to seek out firms with the potential for significant growth.  Finance is provided in exchange for a significant stake in the company. 


Professional investors can bring significant financial and management expertise and personal contacts to the companies they help.  You would have to be happy with the idea of sharing the ownership of your business, and the potential rewards, to take this route of finance.  Bear in mind that if things go wrong they are likely to intervene to protect their investment.

This new fund launched in February 2005 can offer venture capital up to £1 million for small businesses based in Bristol's Objective 2 area.  Phone 01752 609 230 or visit Finance South West.

The South West RDA launched an RVCF in 2002 to provide funding for start-ups and management buy-outs in the region where there is high growth potential.  The fund is managed by South West Ventures and suitable companies in IT, telecoms, healthcare, support services and other sectors can access investment funds of between £50,000 and £500,000.   

Bridges Community Ventures specifically targets businesses established in under-invested areas, which includes Ashley, Easton, Lawrence Hill, Windmill Hill and Filwood as well as other wards in the City of Bristol.  They can offer both equity and debt finance.  To find out more about their investment policy, visit their website.  

You will need a convincing business plan showing forecast profit figures, cashflow and projected balance sheets and the confidence to present your ideas to obtain money from investors.  Check out your plan with a local Business Advisor or try the new online service called the Gauntlet (cost £199).  Produced by the London School of Economics it will find any weaknesses in your proposals before you go in front of an investor.