Two years later we had some momentum and a real business plan; and the dot com industry was booming and we knew that Sift had experience and activities that investors would find ‘sexy’, so it was an opportunity to seek funding. We weren’t hugely successful financially at the time, breaking even on turnover of £300,000 in 1998.
Amazingly, we raised £7.5 million in 1999 and 2000 from two main investors, without losing control of the business. The funding enabled us to push the button and kick on with all the different ideas that we had.
We were fortunate to be around in a period when investors were looking for companies just like us in a hot sector (i.e. developing internet communities and community technology). There are still hot areas of course; at the moment certain areas of IT and social media are in a sweet spot; that hot frothy environment where people know it’s on the rise and ready to bet their cash on it.
I’ve always thought it’s strange how some industries are deemed hot and others not, especially when it comes to government hand-outs. The digital media industry employs tens of thousands of people all over the UK, is a vital part of the economy, and yet only receives patchy support.
The upside is that the industry just gets on with things, which is a good thing. It brings diversity, flexible models and a strong entrepreneurial spirit; in contrast to some other industries more reliant on public funding.
So is it easy to raise finance in the creative industries? No, especially if you’re not in one of the sweet spots. But between all the different finance options out there, if you have the right product and the right set-up then there is absolutely an opportunity. And of course good people always find a way to develop their business ideas – whatever the challenges!