Overview

 

Venture capital investing often means partnering with businesses at an early stage, when support functions and systems might not be ready to sustain rapid growth. In recognition of this, our advisory division has a dedicated investee support team, with particular expertise in finance and systems.

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Hotpod Yoga

An example of the support we have provided to an investee company is Hotpod Yoga. At the point of investing in April 2017, Hotpod were using an outsourced finance facility which was not sufficient for their needs, yet they were not ready to invest in a permanent function in-house. This is a typical challenge for emerging businesses whereby a professionalised and full scope finance solution can be somewhat out of reach owing to the relatively small scale of the business (meaning full time finance is not cost effective) and other staffing priorities.

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What we did

We are able to provide the perfect bridge comprising of a flexible, professional service and a commitment to delivering the highest quality service because as investors we were fully-aligned with senior management in requiring the best possible financial support and output for the business.

In the case of Hotpod, we replaced the incumbent finance service within eight weeks of investing and provided bookkeeping and management reporting services enabling the business to benefit from more timely and relevant financial information as well as better cash and systems controls. We were also able to provide tailored support at the Finance Director level, inputting on systems design, preparing and analysing budgets and providing a sounding board with an experienced finance professional.

All businesses must aspire towards their own finance solution and in early 2019, we agreed with Hotpod management that the necessary scale was in place to move finances in-house. At this point, we led on the recruitment of a Finance Manager who was eventually placed in April 2019. Our advisory team’s flexible support continued as an outsourced support team to the newly placed Finance Manager as well as a continuation of the Finance Directorship.

By early 2020, Hotpod had recruited their own Finance Director, and they are now entirely self-sufficient with a dedicated finance team.

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Conclusion

Our advisory team’s work with Hotpod highlights how a flexible and fully incentivised finance solution can be invaluable to young companies, and in turn valuable to us the investor as we accelerate our knowledge and relationship building with our investee partners.

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