Memberd. Funding outline V.1
Fund Raising Introduction
This first stage document explores the commercial logistics and necessary structures for the purpose of Fundraising Memberd’s further commercial development.
Objectives & Considerations
The Plan
Key Questions:
1 Do we have the following information?
i P&L for two years trading
ii Cash-Flow forecast for the same
iii Detailed breakdown of key Capital Expenditure
iv Costings for Staffing, Management, out-sourced support & other
v A marketing & promo cost plan including the launch phase and year one beyond?
2 Will the UK Office be virtual or physically set in London?
3 Are Memberd to appoint any new Directors to support the Fundraising and or launch phase?
4 Initially, will Memberd require any additional management?
5 Are accountants and or, other financial advisors supporting the provision of the above information?
6 Does Memberd qualify for EIS relief?
Incorporation The current Memberd structure?
1 Is Memberd currently a UK-limited company?
2 If so, we need to analyse the existing shareholdings pending any equity distribution to prospective investors
3 If not, we need analyse the rationale of best company structure and if appropriate, issue relevant shareholdings
4 Do any Directors, or other parties, currently have Loans into ‘Memberd?
“Sometimes it falls upon a generation to be great. You can be that generation.”
Nelson Mandela
Funding Possible Options
Clearly, ongoing structural discussions will yield more details in this regard. However, it should be noted that a range of UK-based funding facilities are worth consideration.
To this end, any preference towards Loan Capital vs Equity led investment requires early consideration.
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VC
A standard approach to start-up funding is Venture and or, Private investor-led funding both of which can take the form of straight funds for Equity or, Loan Capital convertible into Shares based upon a certain prescribed formula.
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CrowdFunding
A commonly understood and fast-growing concept, Memberd could be well placed to benefit from a significant capital raise if this is felt to be an appropriate approach. Not least, it is seen as the most cost-effective process in ‘equity’ allocation terms. In addition, it has a cheaper entry cost than many other funding methods.
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Celebrity ‘Funds’
As discussed, a growing number of high-level sports and music personalities are now diversifying into tech-related ventures. Not least Roger Federer, Rory McIlroy, Serena Williams and Andy Murray, all of whom we have significant contact with and access to.
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Corporate lending -P2P
Similar to the above Crowdfunding model, P2P lenders provide more mature entities with funding at competitive rates. A low level of administration and bureaucracy is associated with this sector although it clearly creates a Debt-over-equity position at the outset of the ongoing venture.
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Loan Capital
Various institutions other than bank-related lenders, are now much more aligned towards the early stage business and it’s funding requirements and should be considered upon merit and need.
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Summary
Timing + Action
Given the proposed launch date of September 1st, there is a certain urgency towards any form of fundraising and the creation of all relevant documentation to support this process.
As discussed, my own involvement as a Consultant to Memberd sits well within this sphere with the potential to drive influential connections. However, the provision of relevant support documentation is essential to the funding drive.