West Coast Hatchery launched
Entrepreneurial-Spark® ("E-Spark") has today launched its second facility in Scotland at the headquarters of Sir Tom Hunter's West Coast Capital.
The operation there will provide a boost for Ayrshire as it focuses on accelerating potential high impact businesses and has uniquely gained funding from both philanthropy and Local Councils.
In turn to mark E-Spark's continued drive to deliver ambitious growth for Scotland's fragile start-up businesses, it was announced that they would soon launch an equity based crowd-funding model loosely based on President Obama's election fundraising campaign.
E-Spark West Coast was launched by Cabinet Secretary for Finance, Employment and Sustainable Growth John Swinney. He said:
"Scotland is recognised for our contribution to shaping the modern world through innovation and the Scottish Government, with our agencies and Local Authorities, work closely with business and industry to ensure the country continues to be a competitive hotbed, generating innovative ideas and new entrepreneurs.
"Entrepreneurial Spark's decision to establish operations in Ayrshire is a fantastic boost to the local business community. This industry led, not-for-profit initiative, is the first of its kind in Scotland and offers new start-up businesses, free workspace, IT access and invaluable mentoring advice from Scotland's leading business people.
"I am confident that this private and public sector collaboration will play a key role in providing our next generation of entrepreneurs with the skills and tools they need to flourish and contribute to Scotland's economic success."
The facility has been jointly funded via support from The Hunter Foundation who are providing all the infrastructure support and East, North and South Ayrshire. E-Spark has attracted applications from over 100 companies keen to benefit from the facilities, mentoring and support on offer for free with thirty companies now selected and operational there.
Sir Tom Hunter commented;
"E-Spark sums up the spirit of Scotland for me - ambitious, innovative and grounded in excellence…The equity based crowd-funding model is a really innovative means to both reducing the cost of fundraising but also accelerating that funding, which in turn is great for start-up businesses and for Scotland's ambitions.
"As Jim Duffy and his team prove E-Spark's high growth support model works, we need to move rapidly to scaling this up across Scotland using this public-private sector partnership approach."
Explaining the equity crowd-funding model, founder and Chief Executive of E-Spark, Jim Duffy said;
"In essence, this will allow Scotland's growth businesses seeking significant funds, say from £150,000 to £1 million to raise much needed funds at markedly reduced cost. This plugs a significant gap in the market and was pioneered in Scotland by Brew Dog. The great thing about this scheme, devised by Harper Macleod with NCM Finance who are FSA authorized, is we can drive this forward for numerous businesses with two from E-Spark already readying their fundraising announcements…
"Our philosophy is simple - where we see barriers to growth for start-up business we either knock them down or go around them; finance is simply one of those barriers."
Paula Skinner, partner at Harper Macleod LLP said "In the current climate, funding for entrepreneurs and businesses is becoming increasingly harder to secure. Bank debt is virtually non-existent for many early stage businesses and whilst in Scotland, we have an active angel investment community, it is still difficult for businesses to get access to capital. We want to help businesses and the Scottish economy by being innovative and developing alternative sources of funding that represents value to all involved."
Councillor Jim Buchanan, Spokesperson for Delivering Community Regeneration, East Ayrshire Council said: "In partnership with our colleagues in South and North Ayrshire we're happy to give our commitment to Ayrshire Entrepreneurial Spark. In East Ayrshire we're working hard to build a spirit of entrepreneurship within the community from the bottom up with projects in our schools and a strong business development team working to support local business. Entrepreneurial Spark will help us take that support to a new level, giving our local enterprises the best chance possible to build on success."
Councillor Bill Grant, South Ayrshire Council's Portfolio Holder for Economic Development, Tourism and Leisure said: "We're proud to be supporting the Ayrshire Entrepreneurial Spark® in partnership with colleagues in East and North Ayrshire Councils.
"Ayrshire is a fantastic place to do business, with great transport connections and business support networks. The commitment from Sir Tom Hunter and his team will offer a host of outstanding opportunities for new companies to succeed at home and abroad.
"This support, allied to the three-year funding commitment from each of the Ayrshire Councils will have a significant impact, driving business growth and maximising the scope and potential for start-up companies to succeed and flourish in a competitive marketplace.
"Working together, I'm confident we will deliver economic growth, create jobs and help put Ayrshire firmly on the map as a productive, exciting and outstanding place for people to do business."
Councillor Marie Burns, North Ayrshire Council spokeswoman for Economic Development and Regeneration, said: "Building a vibrant local economy with more businesses and jobs is one of North Ayrshire Council's key objectives. "By supporting Entrepreneurial Spark® we are investing in budding businesses and helping to ensure they get off to the best possible start. "We are delighted to be working with South and East Ayrshire Councils, as well as Sir Tom Hunter and the Entrepreneurial Spark® team. "The facilities at the Business Hatchery, as well as the support and mentoring on offer, mean that our early stage businesses will have the best possible chance of success."
Gordon Merrylees, RBS Regional Managing Director of Business Banking Scotland said, "It takes enormous determination and commitment to start a new business and we must ensure that anyone looking to take that step has the right encouragement and support available to them. Entrepreneurial Spark is an important and exciting initiative as it will provide solid foundations to help the next generation of Scottish entrepreneurs grow successful, sustainable
businesses. We are delighted to provide our support and aim to become an integral part of the project."
As part of the strategic partnership RBS has agreed to fund grants for a number of start-ups in each hatchery.
E-Spark will announce the name and set up of their equity crowd funding model in July and has two companies from the first E-Spark based in Glasgow lined up to launch fundraising exercises soon after.