This timing could be fortuitous

Jul 23 2008 by Andrew Hebden, The Journal

ALISTAIR Arkley and his nine unnamed associates who have just ploughed some £3m into a new fund for budding North East entrepreneurs may appear to be taking something of a gamble with the economy facing such troubled times.

However, their venture may well just turn out to be as wise as it is welcome.

Access to finance has never been particularly easy in this part of the world, with relatively few venture capitalists available on the doorstep.

Too often those with bright business ideas are forced to look elsewhere for willing backers – and it can prove a costly loss to the region.

The problems have been magnified by the current economic climate, which has seen some banks all but pull down the shutters to new business. While some venture capitalists may fill this gap in the market, they will be able to be more choosy about which start-ups they support.

Evidence shows that the winners in such circumstances tend to be those with a bit of experience of the market and a track record to boot.

The losers tend to be the inexperienced guys who may yet turn out to be the brightest prospects. If Mr Arkley and his Hotspur Capital Partners can offer a lifeline for these talented young entrepreneurs, they will be providing a very valuable service to the region.

It is an essential part of the region’s talent attraction agenda that we are able to provide start-up businesses with the kind of finance and support they require.

It is to be hoped that some of the ideas they come up with are better than one or two of those featured on Dragons’ Den, which made a welcome return to our screens on Monday night.

It is slightly depressing to see that two apparently sane individuals can enter the Den hoping for a £50,000 investment in their “idea” of a company that sells bed sheets with a line down the middle to stop couples arguing over who is taking an unfair share of the bedclothes.

But for every “Laylines” there is also a D4M, an innovative events company staffed by four young female entrepreneurs.

The dragons were almost fighting among themselves to hand over their cash to this bright young quartet. Let’s hope Mr Arkley and his associates are faced with a similar predicament.

Andrew Hebden is assistant editor (business) of The Journal