Nine And A Half Weeks, Nine And Half Million Pounds

Today the news hot off the press is that Livebookings* has raised $16m / £9.5m in VC funding thanks to an investment into the company by Wellington Partners.

You can read the full story here.

(* Livebookings is Europe’s largest online marketing and reservations service for the restaurant industry. We help restaurants fill their tables by delivering customers through a free online booking service and network of high-profile partner websites. I say "we" because they’re my employer, too.)

For me personally I can reflect on a summer that was dominated by the fund-raising round and the due diligence process that followed. I feel very lucky to have been involved. I met many VCs myself and the process helped us really refine our business plan, check, double-check and re-check the assumptions and think carefully about our long term strategy. We’ve also received some great input on how to improve our business operations.

Raising capital in the summer months is always more tricky as so many people are away, and doing so in a recession at break-neck speed is an extra challenge. However, it does have the added benefit that we now have a solid foundation of a three year plan in place and so preparing a detailed operational budget for 2010 will be easier.


So, what did I learn from the summer of fundraising?

1. Ask for help to refine the pitch

The pitch we made was rehearsed several times with existing investors who had a feel for what a future investor would need to know. What are the key assumptions that need to stand up for the investor to buy into the growth plan? Address these issues face on.

2. Keep it simple

If we’re not careful, our business can come across as complicated. We really had to focus on making it straightforward as possible to explain the “what”, “why”, “how” and “when”. Using visual aids in presentations is vital to convey meaning, and being able to visualise concepts with pictures is essential.

3. Build and test a very detailed supporting business plan

The business plan that our team prepared was very thorough with lots and lots of assumptions building up a very thorough view of the business over the next few years. It was a collaborative effort and took weeks to nail down. I noticed that what was important here was not to just create the plan, but to be able to talk around some of the key ratios such as cost-of sale, revenue per unit, marketing efficiency and traffic source, share and conversion. Knowing these numbers is the core of the pitch.

4. Prioritise the fundraising process but protect key people

In a fundraising round, you have to be prepared to drop everything to answer investor questions, travel to a pitch, answer follow up questions and provide supplementary data. It means dropping everything else, so you need a part of the team that are focused on running the day to day business so it doesn’t grind to a halt.

5. Show your passion

People buy people and if you’re not excited about your business, how will someone else be? Enthusiasm is contagious, so show the world what makes you tick and why your business is exciting. If it’s not exciting, what are you pitching for?

6. Enjoy the ride

Despite the hard work involved, I really enjoyed the process. I will be the first to hold my hand up and say that there are others on the team who were much more involved than me, but when I did participate I looked forward to the investor meetings. It was a privilege to meet smart people who could think about your business from different angles and help you refine your approach every time. It was a great experience and I was very happy to be involved.


If you’re out there raising money for your business right now, I wish you all the best, and every success.

Learn Something New Every Day

You learn something new every day, so goes the saying.

We all have different things that make us "tick". For me, one of the strongest motivators is learning something new, either through experience or through reading.

Here's a little snippet I picked up yesterday. I was reading Peter Hargreave's book "In For A Penny", the story of how he and his business partner built up their business from scratch starting with just a telephone and a desk in a spare bedroom. Now the business (Hargeaves Lansdown) is one of the biggest financial services firms in the UK and is a listed public company.

Aside from picking up on their business principles (best service, best prices, best information), their company culture (put the customer first, the company second, yourself third), and their innovative real time trading platform for private investors, one little snippet of trivia grabbed my attention.

When you come to cash in your pension on retirement, one option is to buy an annuity with your pension fund (I knew that already by the way). This annuity is a fixed regular payment that you receive for the rest of your life. The life companies that sell these policies assess your risk profile. High risk, you can buy less income with your money, low risk, you can buy more.

The interesting thing is that the more money you have in your pension, the more risky you are to a life company. Why? Well it seems statistically that people with more money live longer. Maybe this is because they can afford a better lifestyle and health care, I'm not sure. As they live longer, then the life company has to pay out the fixed sum for longer, so therefore large pension fund owners will find it more difficult to get a better deal.

I thought about this for a moment on the train. First of all, I was disappointed that if I did make the effort to save harder, I would get a worse deal. However the upside is much more interesting; work hard to accumulate a bigger pot and you might live longer. I'd never thought of life expectancy as a reason to work hard, but there it is.

But how to be successful? One of the other books I read recently was Malcolm Gladwell's book "Outliers". Here he looks at the truly successful people in their fields and looked at what patterns stood out.

It seems that you need "enough" education (not necessarily the best), "enough" talent (pure talent will not cut it on it's own), fortunate circumstances (luck), and the most important two ingredients of all: focus and effort.

This was encouraging. I'm a great believer in making your own luck. Work hard, see obstacles as opportunities and take control of your own destiny. Sure, life throws you a deck of cards, but even with an average hand you can play a good game.

Learning is great, and knowledge is best enjoyed if shared. Therefore at work recently I took the initiative to start a library. The two books I mentioned above plus another twenty or thirty from my personal bookshelves start the library stock. I've asked colleagues to also bring in their books to loan to the collection. I've bought library cards to put in the front of each book and developed a system for withdrawals and returns. I hope it takes off. I'm looking forward to sharing ideas and seeing the team grow through learning.

Learn something new every day. My new mantra.