Funding is becoming easier for start-ups that have the potential to grow fast as the economy recovers, according to Julie Meyer, chief executive of Ariadne Capital and panellist on the BBC’s Online Dragons’ Den.
Meyer made the claim as she announced that Ariadne had helped five early stage companies in the past six months to close new funding rounds.
Interest in investing is being driven by a feeling that valuations are now reasonable and that gains can be made quickly as the economy recovers, according to Meyer.
“The smart money knows that in the last stages of a market downturn the forces of growth are at work and the full bloom won’t become obvious until much later,” she said.
Larger companies are also making acquisitions based on this perception, according to Meyer, who noted that she is working on three such deals.
“Now is a pretty good time to invest,” she said. “You don’t want to be investing at the top of
The economy is displaying signs of a strong recovery, according to figures published this week.
Employment growth rose in April to its highest level since February 2007. The closely watched CIPS/Markit Purchasing Managers Index showed manufacturing in April jumped to the highest level since September 1994.
Meyer claimed that technology businesses offered the best opportunities for early stage investors, particularly in the area of computing known as software as a service.
“There are a lot of companies that have been built in this area, but they are in their infancy,” she said.
She advised founders of early stage ventures to focus on building inclusive business models.
“Why is EMI struggling while early stage companies in the music industry like Slicethepie and
Spotify are transforming the sector? It’s because their business models align all the stakeholders in the transaction.”
Meyer also encouraged entrepreneurs to emphasise the social objectives of their businesses.
“All great companies have a cause, which is why Apple flies high,” she said.
Get alerts on Entrepreneurship when a new story is published