🎃 GiggedAI's Campaign, 4 Conferences, Investor Rights
Here's your Campfire for the 30th of October, 2023. Find today's deep dive on investor rights and consents below.
Before we begin: Only a few days left to Fill out the Founders Survey and share your views about the investment landscape in Scotland. It's an entirely volunteer-led initiative, so we need the support of the community. You can use this link for sharing.
💼 This issue of Campfire is sponsored by Shepherd and Wedderburn's initiative to supercharge start-ups and scale-ups. Be sure to follow the Start to Scale LinkedIn page for useful videos and posts designed to help founders.
🌊 Updates & Opinions
🚀 Glasgow-based Gigged.AI (on-demand talent for tech), has announced a “30 Days of AI” campaign, starting 1st November 2023, collaborating with OpenAI. Selected businesses will have their projects fully underwritten by GiggedAI and get free OpenAI credits. DGT
📉 According to the Fraser of Allander Institute at the University of Strathclyde, growth in the Scottish economy has been faltering over 2023, with a high interest rate environment and wider economic uncertainty leading to investment being delayed or cancelled. IN SBN TH TS
🏎️ Glasgow is one of the fastest-growing UK startup ecosystems for venture capital investment (along with Belfast and Birmingham but who cares about them?), according to new data from HSBC Innovation Banking (the rebranded SVB) and Dealroom. UKTN
💰 Eight new regional innovation clusters will receive a share of £75m in government funding. In Scotland, the cluster announced is bio-based manufacturing. UKTN
📈 Edinburgh University’s Venture Builder Incubator (VBI) programme is starting a new programme in Robotics (partnered with Barclays Eagle Labs ‘Ecosystem Partnership Programme,’ and is getting new support from the UK Government. DGT TH
🎫 There are a series of in-person conferences and online events taking place between October 30 and November 3 including the Scottish Black Talent Summit, Scottish Games Week, Digital DNA Conference and the Censis Tech Summit that form part of the Scottish International Week. Events are also taking place in mainland Europe, Asia, and North America. More info . TS
💈 Edinburgh-based Hairtracker.app just won a "Innovate UK Unlocking Potential - Begin" award - congrats!
New direct flights
✈️ EDI -> NYC (JetBlue) IN
📣 Asks & Offers
📣 We've launched the Founders Survey! Please fill it out, it takes less time than you spend making that artisanal pour-over coffee in the morning. If you have a mailing list of startup founders, and would be willing to share the survey, let us know!
🔒 Cyber Security Questionnaire: Rada Cyber Security is looking for anyone working in small or medium sized businesses in Scotland to fill out a quick questionnaire about cyber security to help in their research: Answer here.
👭 Interested in connecting with possible co-founders? Fill in your listing on Cofounder Curious today! Connect with others for possible cofounder matching here.
🤝 Geovation Mentorship Programme 2024 is now open! Are you ready to elevate both your personal and professional path Geovation’s Mentorship Programme provides a one-to-one mentoring experience, crafted to suit your unique aspirations. 👉 Apply Here. Deadline 16th Nov.
✍️ Want to write something for Campfire? Have an opinion you'd like to share? get in touch!
🦸 The Deep Dive: Investor Rights (part two)
By Robert Gelb, sponsored by Shepherd & Wedderburn
This is part two of a series about simple things you can do early to save time and money later when planning your first fundraise written in partnership with Shepherd & Wedderburn.
Last year we ran the Founders' Survey on the investment landscape in Scotland, and one thing that kept coming up was the subject of mis-matched investor rights.
It's a tricky situation. If you're taking investment, it makes sense that your investors will want some rights in exchange for that investment, and if they insist on certain investor rights, it can be tempting to just agree so you can get on with building the business. But sometimes the rights you've agreed to might come back to cause issues the next time you go for investment or want to make changes.
Not all of us want to raise money over multiple rounds, or go on the venture path, however sometimes it's hard to know what best practice looks like, and when a term or right requested by an incoming investor is completely normal or potentially problematic.
I sat down with John and Stephen from Shepherd & Wedderburn to talk about the right way to think about investor rights when starting out, especially with one eye towards what can make future deals/raises less challenging. They pointed out a few areas to consider regarding investor rights for your startup to get off on the best foot, and so that there aren't common red flags for future investors when they take a look under the hood.
What are investors looking for?
One of the most important elements when considering any investment is thinking about the end in mind. It makes sense that early investors might be worried about being diluted into oblivion or being muscled out by some large VC, and therefore wish to take action they see as 'protecting' their investment.
In reality though, that same behaviour could actually increase the likelihood of putting that investment at risk. Later stage investors also think with the end in mind, and so, ultimately, they are going to be thinking about any potential bumps on the road that might stand in the way of their exit.
Things like named investor consents, equity protected from dilution, certain ‘baked in’ liquidation preference returns, unreasonable or unwieldy consent requirements, or guaranteed named board seats are all examples of common asks for early stage investors that bring with them a bunch of problems when it comes time to raise future rounds. It's hard to convince someone to give up control once they already have it.
One solution that John and Stephen suggest for when you're still early-stage, is to attach rights to minimum holdings, not specific investors.
The idea of investors needing certain rights isn't inherently wrong, or problematic. The issues usually crop up when it's attached to a named investor, as there's a mismatched set of incentives when it comes to preserving those rights (i.e. there aren't any).
For example, instead of guaranteeing an investor a board seat, set an equity requirement at a percentage of share capital for any investor to have such an appointment right. When you do this, you're setting sensible thresholds for particular rights to fall away if/when you raise in the future. When the company then raises future capital, you're not then having to renegotiate whether or not someone has a particular set of rights or consents. Set those at the get go and bake in future-proofing that is applicable to all future investors.
When it does then come time to raise, an investor can come along, look at those deal terms, and see that if they hold 10% (for example), they might be considered a 'major investor', and a major investor gets a board seat, pre-emption rights on new share issues, and some information rights (again, just for example). And they'll then know that if they want to maintain that position in future funding rounds, they'll have to follow-on on their position, because otherwise they might drop down and lose those entitlements.
Not every investor would be happy with this arrangement, and some will still insist on different types of consents that may be needed, so it’s not a hard and fast rule, but something to keep in mind as a way to set a default expectation from which to negotiate.
The goal with this and any other suggestion is to prompt some thinking about little things you can do early on that might increase optionality going forward. Remember to talk to other founders, especially founders who've taken investment from your potential investors. Do your Due Diligence on investors, and understand what they usually expect.
At the end of the day, no two deals are the same just as no two companies nor investors are the same. If you have investors who have certain rights that might be considered problematic by someone else but it works for you, don't sweat. It's your company.
Stay tuned for part three: the benefits & drawbacks of using automated legal platforms in funding rounds.
Shepherd & Wedderburn's innovative and personable approach helps companies from first incorporation onwards (including through to an exit – if that’s the goal). Their global reach means they can scale and grow with you, like they have with clients like Epic Games, FanDuel, TwoBigEars, Optoscribe and TVSquared. They even have a dedicated team who specialise in the topics discussed in this Part two.
👉 To learn more, check out the Start to Scale LinkedIn page for useful videos and posts designed to help early stage founders and send an email starttoscale@shepwedd.co.uk & set up a chat.
📅 Events
🕹️ 30/10-31/10, 09:00 🗺️ Edinburgh: Scottish Games Week: The conference brings together game developers, publishers and the wider industry in an inclusive forum to explore the challenges of working within the games ecosystem. MORE INFO
👔 30/10, 11:30 🗺️ Edinburgh: Scottish Black Talent Summit & Hiring Fair 2023: The two-day hiring fair and summit is designed to host black talent, talent acquisition and HR professionals, diversity and inclusion experts, industry players, government and local authorities’ representatives, as well as university communities. MORE INFO
🤝 30/10, 18:00 🗺️ Edinburgh: Startup Founders Meetup: Each month, we'll have a combination of tactical fireside chats with experienced entrepreneurs and plenty of opportunities to network with other founders, potential cofounders, and investors. MORE INFO
👨⚕️ 31/10, 09:00 🗺️ Edinburgh: Skills Workshop: Web Accessibility: explore the foundations of accessible web design for If you are involved in product or service design at any stage, then you are a designer who can make someone's life better or miserable. MORE INFO
💽 31/10, 18:00 🗺️ Dundee: Dundee Data Meetup: a vibrant community-driven event that brings together curious learners, data enthusiasts and professionals to explore the captivating world of data and its applications. MORE INFO
☕ Series: Unfiltered: Connect with members of the local tech community, the coffee is on us!
📆 01/11, 08:30 🗺️ Edinburgh MORE INFO
📆 01/11, 08:30 🗺️ Glasgow MORE INFO
📆 01/11, 08:30 🗺️ Aberdeen MORE INFO
📆 01/11, 08:30 🗺️ Inverness MORE INFO
📆 01/11, 08:30 🗺️ Stirling MORE INFO
📆 01/11, 08:30 🗺️ Dundee MORE INFO
👩💻 01/11, 09:30 🗺️ Edinburgh: Female Founders Rise X Edinburgh: Female Founders Rise is a community of over 2000 female founders in the UK coming together for collaboration, growth and support. MORE INFO
🤝 01/11, 09:30 🗺️ Dumfries: Coworking Day [South of Scotland]: We're hosting these coworking days every Wednesday from 25th October - 13th December 2023, where you can join us for startup chat, networking, and to get to know you local tech-curious peers. MORE INFO
🎧 02/11, 08:00 🗺️ Edinburgh: Super-duper user programs: The Spotify team will kick off by sharing some background on the Spotify Stars before we open the floor to discuss the many things to consider: recruitment, onboarding, incentives, diversity, events, ROI and much much more. MORE INFO
🤝 02/11, 12:00 🗺️ Edinburgh: AccelerateHER + Techscaler Meetup: Edinburgh and Lothians: For women and non-binary folk in the tech startup world to network and connect. MORE INFO
🎫 02/11, 09:00 🗺️ Glasgow: Tech Summit 2023: The biggest event in the CENSIS calendar is our annual conference, the Technology Summit. Join us in person in November 2023 to mark 10 years of CENSIS innovation in Scotland. This is an in-person event only and we will not be live streaming any parts of the day. MORE INFO
👥 02/11, 20:00 🗺️ Glasgow: Tech Meetup November: Tech Meetup is a generalist event for everyone in the Glasgow tech community. We welcome people with all levels of experience . Even if you are starting your journey into tech as a student or bootcamper or your thinking of starting your development career, you are more than welcome. MORE INFO
⚖️ 06/11, 14:00 🗺️ Online: CSO & Techscaler Partnership Webinar: Techscaler and the CSO Regional Innovation Hubs are embarking on a new collaboration to inspire NHS colleagues, startups and life science academics alike to get involved and find solutions for the biggest health challenges. MORE INFO
⛓️ 06/11, 19:00 🗺️ Dundee: Monthly Scottish Blockchain Meetup: Web3 gaming + Networking, dinner & drinks: Welcome to the Monthly Scottish Blockchain Meetup - this time at the Abertay cyberQuarter in Dundee, that is a co-host of the event. This event is supported by Techscaler by Codebase. MORE INFO
🧠 07/11, 09:00 🗺️ Glasgow: CAN DO Innovation Summit 2023: For the 2023 Edition, we’ll be exploring the rapid advances towards a tech-driven, sustainable and virtual future for SMEs and Start-ups in all sectors. Our peer-led industry sessions offer practical insights on how new technologies, great leadership and the right business cultures can help tackle the challenges we are facing in industry and society. MORE INFO
🌆 07/11, 10:00 🗺️Dundee: Tay Cities Region Deal: Digital Skills Project Launch: This in-person event is your chance to delve into the world of digital skills and discuss how we can work collaboratively across business, education, the third and public sector to meet the skills needs for the region. MORE INFO
👔 07/11, 16:00 🗺️ Edinburgh: Hiring to Scale: MBM Commercial, Barclays Wealth and Barclays Eagle Labs have come together to for an exciting series where we dive deep into the world of scaling your team! Whether you're a startup or an established company, finding and hiring the right talent can be a daunting task. But fear not! Our event series is here to guide you through the process, providing valuable insights and practical tips. MORE INFO
🚑 08/11, 08:45 🗺️ Glasgow: Living Laboratory Healthcare Innovation Conference: Join the University of Glasgow’s Living Laboratory for Precision Medicine at its Healthcare Innovation Conference. The event will bring together a mixture of delegates from across academia, industry, and healthcare to explore the exciting possibilities and current challenges of healthcare innovations. MORE INFO
🏴☠️ 08/11, 09:00 🗺️ Dundee: Get Hacktive - Ethical Hackathon Challenge: Join us for a one-day Hackathon where you will get the opportunity to work on live Cyber Crime challenges and create innovative solutions that enhance security in our communities to support Police Scotland. MORE INFO
🤝 08/11, 09:30 🗺️ Dumfries: Coworking Day [South of Scotland]: We're hosting these coworking days every Wednesday from 25th October - 13th December 2023, where you can join us for startup chat, networking, and to get to know you local tech-curious peers. MORE INFO
🌋 08/11, 12:00 🗺️ Inverness: AccelerateHER + Techscaler Meetup: Highlands and Islands: The AccelerateHER and Techscaler by CodeBase teams are excited to be joining forces in bringing dedicated meetups to life across Scotland for this community and peer-support building activity to grow. Meetups where you can come together, hear inspiring stories from fellow women and non-binary founders, and connect for ongoing peer-support. MORE INFO
🚄 08/11, 21:30 🗺️ Edinburgh: Speed Networking for Startups: This event is for anyone involved in the startup community who is interested in meeting new people from the community. MORE INFO
💊 09/11, 08:30 🗺️ Edinburgh: Edinburgh Medtech Forum: Come join us for our second Edinburgh Medtech Forums meeting! We will be joined by our guest speaker Dr Matt Freer, CEO of Infix Support Ltd who will share his experience of funding and growing a successful innovative startup and selling into the NHS. MORE INFO
👥 09/11, 12:00 🗺️ Aberdeen: AccelerateHER + Techscaler Meetup: Aberdeen: Our AccelerateHER + Techscaler Meetup will be a space where you can come together, hear inspiring stories from fellow women and non-binary founders, and connect for ongoing peer-support. The Aberdeen event is hosted by AccelerateHER and Techscaler, as part of their nation-wide series of dedicated meetups helping peer-support building activity to grow. MORE INFO
💬 09/11, 16:00 🗺️ Dundee: Games Start-Up Journey: Let’s Talk About Inclusivity: Discover essential tips to adopt diversity in your team, learn how to create games that resonate with all audiences, and foster an inclusive gaming environment that celebrates differences! MORE INFO
⛓️ 09/11, 17:00 🗺️ Edinburgh: Monthly Scottish Blockchain Meetup: Welcome to the Monthly Scottish Blockchain Meetup in CodeBase!. MORE INFO
🚶♀️ 10/11, 13:30 🗺️ Edinburgh: Netwalking - November sun! By Barclays Eagle Labs: Join this Mindful Netwalking experience: Meet other Founders, enjoying the healthy way to network, inspired by a gentle walk. MORE INFO
🎯 Deadlines
🇬🇧 Upcoming Innovate UK deadlines:
SSPP: Liquid food and beverages in refillable packaging Applications close 25 October
Collaborative AI Solutions to improve productivity in key sectors Applications close 8 November
MyWorld Collaborative Research and Development: Round 2 Applications close 23 November
Are we missing your event or deadline? 👉 Submit it here!Think someone would like this issue? Forward it to them! Check out previous issues and subscribe here.That’s all for this week - have a great one!Team 🔥Campfire
Are we missing your event or deadline? 👉 Submit it here!
Think someone would like this issue? Forward it to them! Check out previous issues and subscribe here.
That’s all for this week - have a great one!
Team 🔥Campfire