Warren Vick of Europa Technologies, Martin Port from Masternaut and icomplete.com’s Stuart Hibbert are three leading entrepreneurs from the British technology industry. They have continued to invest in the technology behind their businesses, some even ramping up funding for R&D. But they say the banks have no faith in their endeavours.
Port founded vehicle tracking firm Masternaut six years ago. His firm currently turns over £21.7m and boasts a subscriber base of more than 60,000, including Duncan Bannatyne‘s fitness chain. He recently spent over £1m installing a new CRM system from Microsoft. The result” "We’ve made a £400,000 saving," he says. "And there’s been a 50 per cent improvement in effiiciency.
"But I had the biggest problem working with my bank," he continues. "I’d recently made a £6m company acquisition. Around £5m of that value was tied up in property: a data centre. Now, that property’s worth around £3m, so the bank’s risk has increased from £1m to £3m. So they’re piling on the surcharges. It’s been a real challenge."
Vick and Hibbert are finalists in the Dell Small Business Excellence Awards. Europa Technologies, a digital mapping firm serving Global Fortune 500 companies, saw sales of £501m in 2008 according to Onesource. While Hibbert’s online business services suite, icomplete.com, is a master of Web 2.0 for small business.
Hibbert says: "My company is two years old. The banks are willing to lend money – but they want your house. I looked at angel investment, Angels Den and the like, but you have to give away too much equity."
Vick agrees: "The real challenges come form the financial community. My father was in retail and he had a saying, ‘The banks will never lend you an umbrella when it’s raining.’ He was right."
And the future looks to get even bleaker. "I know a business whose bank snatched away their overdraft really suddenly," says Hibbert. "They had to lay off half their staff and they’re barely afloat."