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Friday, 24 May 2013

My blog re how to challenge the offshore UHNWs to creat community of "intelligent capital" for europe? re Hipsters Flocking to Silicon Roundabout as Bankers Fade - Bloomberg

Must read article:
Hipsters Flocking to Silicon Roundabout as Bankers Fade - Bloomberg:



 

Great event, great insights shared+, great people on and off panel.. really hope the panel discussion video can be shared. (some pictures I took: #WhiteFlat Buzz panel at Bloomberg 19May13 http://flic.kr/s/aHsjF6TRQ2 )

Brilliant to have such vibrant & exciting ecosystem/community success so far in the last few years, and well on our way to address "density of network" issue.. (mentioned often by Eze, quoting Reid hoffman)

One of the key challenge as highlighted by Jeremy was that there is not yet many major billion pounds exit yet (IMHO, that is only one measure and most don't end well except for founders & selected early investors, look at Autonomy furore, Bebo that just gone bankrupted after further sell off.. who is to say Skype has done better!?) 

Hopefully in 2013, we will have more startups with "to be proven sustainable business model" in mind rather than short term eyeball gains and exits to bigger player as ultimate goals, Groupon? (some might argue that is the reason why we have no major Internet Tech firms from Europe yet) 

some of the panel mentioned that the Major problem the ecosystem faced with now is apparently lack of startup with real ambition and lack of decent follow on funding  (range of US$500k+ was mentioned) (need verification of the video, sadly I didn't take notes!)

As I asked during the event,  it would be great if panel & others can attempt to address "quality of and competitions between investors" challenge.. (hopefully they are also intelligent also)

IMHO, knowing quite a few of the top investors and many of the well heeled exited and now offshore UHNWs (tax wise, non dom), quite a few of them are still active in business/deals but sadly they are not as 'hungry' any more (can't blame them! & not talking about career fund managers/VCs) and nor they have or need to be under any 'social proof' pressure, as the offshore /anonymity offered by jurisdictions means most are surrounding themselves with yes-men or people wanting their time/resources (& friends/colleagues they trusted) and rarely they see many peers that are much more successful than them (well, it is intrinsically impossible, because they are offshore! they might meet them in local functions but people don't mingle, like at private members club, unless you own the club of course).. 

Further complex the issue is that most UHNWs are in the "linkedOUT" phase and most prefer anonymity,  hence you may have noticed that its same tens of 'big names' guys in the same conferences all over europe.. etc. where in fact many other top UHNWs guys who might be richer but are less active. 

my off the cuff suggestion then was for UK policy maker to consider creating a "density of network" between such off-shored and well heeled potential investors/typically exited mid-cap entrepreneurs/UHNWs (to meet on or offshore 1/2days per year with each other & pre-qualified entrepreneurs with decent firms/ideas).  this should ensure some social proof between the exited successful potential investors so they can see behind close door how some others are doing better from other sectors (very much like in Silicon Valley), this should provide some competitive incentives for the newly formed UHNWs to invest time to meet/listen and thus maybe more likely to take some risk and invest in the next Apple of UK/Europe??  

In return, maybe government can give them few more days to visit friends & family on shore if they have invested based on certain criteria? that might also promote further bragging rights (e.g. how many extra days they get this year..)  the real scale and effect might be much greater than 100s of EIS/SEIS combined!? (have no numbers nor resources to research, please do tell me if I am wrong, keen to learn more!)

Another issue is that the supply of quality entrepreneurs also need to be addressed (not most of the dragons den type but serious well thought out guys please), .. hopefully with intelligent/prequalified capital we will also have intelligent/pre-qualified entrepreneurs... I hope this all make sense, but probably I have written away my invitation now! ;-)  maybe some food for thought? 

BR


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