Business ‘angels’ who invest in entrepreneurs

LIKE TV’s “dragons”, James Malone invests in fledgling
businesses.

He has worked in the technology sector throughout his career but in 2016 he joined the Henley Business Angels, a network of business leaders, entrepreneurs and investors interested in investing and mentoring early-stage businesses.

The group operates from Henley Business School, part of the University of Reading, and investors must be a graduate or have some other connection to the school in Marlow Road between Henley and Hambleden.

Mr Malone says: “I was one of the first people to join and it seemed like an ideal opportunity.

“What the Angels do is support businesses with investment to create jobs and to see a return.

“I’ve always worked for software and tech companies but now I’m investing in other sectors and helping companies to grow, which is something I really enjoy.

“It’s an incentive to work with interesting people as well as my regular career.”

He doesn’t like the comparison with Peter Jones et al on television.

“I have watched Dragons’ Den and the reality of investing in small businesses is quite different,” says Mr Malone.

“We don’t want to catch people out and we are not there to give them a hard time.

“For us, it is about understanding their point of view and finding opportunities to fill the gaps.

“It’s all about having shared goals and ambitions with the founders and knowing how to help them grow into something better during a considerable amount of time.”

He grew up in London and studied industrial systems and business management at the University of Westminster.

He then worked for IBM as a sales manager and as an industrial sector manager.

Mr Malone moved to Henley because he wanted to bring up his children in a nice area with quieter environment outside London.

He now works for Zebra Technologies, an information and technology services company, mainly from home.

Mr Malone actually started investing in businesses 15 years ago when he co-founded a coffee company in Bristol with a close friend from university.

He says: “From that first experience I learnt what questions to ask and how to support someone who wants to do something like that, how to help with the funding and the strategy behind it.”

The business grew and was later sold.

Since then, Mr Malone has gone on to help grow companies all over the country and currently invests in software, technology and food
companies.

Members of the Henley Business Angels have a declared interest to invest in new businesses whose founders are seeking £50,000 to £250,000 to accelerate their growth.

But Mr Malone says that a first-time investment doesn’t need to be a large sum of money and that it will still bring benefits on different levels.

He says: “With any business investment, it makes sense to start conservatively and work out what the company needs in the short term.

“It’s not about giving them everything they need immediately but about giving them what they need at that moment in time, so that they can make sensible decisions about how to grow.

“How they manage that sum makes it reassuring for future investors, showing that they actually know what they are doing.

“We want to see businesses grow to create jobs — that is my main motivator and the reason why I invest.

“There’s also the benefits of working with very smart entrepreneurs — you get to meet very intelligent people that you would not have met otherwise and you get to help them develop their vision. There’s something really exciting about that.

“Everyone investing money is looking for a good return on investment obviously but working with remarkable people is also a big part of it.”

Mr Malone moved to Henley with his wife Kathleen 10 years ago and they have two children, Rebecca, 11, and Matthew, nine.

He says now is the right time to invest in British businesses as the economy tries to recover from the coronavirus pandemic.

“Cash sitting in the bank is not helping anyone at the moment as we have a three per cent inflation rate,” he says.

“Investing your money in something that you can understand and being involved with the people who are receiving the investment is much more important.

“Every investment creates a risk but it will help with the effects that the pandemic has had on our
businesses.

“Anything that creates jobs and supports British businesses will help and is a great thing for the country.

“If you are investing in a new company that manages to create 100 new jobs, or even 10, the results are very tangible and can change the future of people living in that area.

“I’ve got investments in a lot of different sectors, which keeps it fresh, and I can see lots of potential in the companies I work with.

“I’ve been involved with the Business Angels as an investor and as a mentor.

“You have to have some connection to Henley Business School and we try to keep it local as what we want is to build and create new jobs in the area.

“But we try to make sure it’s diverse as well, with entrepreneurs from different backgrounds and sectors.”

One of the companies he invested in is Kymira, a smart textile company founded by Tim Brownstone, who attended the Henley Business School.

“I’ve worked with him since the start,” says Mr Malone. “I was really interested in his concept and helped out in the early stages and it has grown really well and is a prime example of what the Henley Business Angels are really about.” Since it was funded in 2013, Kymira has been recognised as one of the world’s top 20 clean technology companies by consulting firm Accenture.

It works with institutions such as universities, NHS trusts and the UK and European Space Agencies to research, innovate and clinically validate new textile technologies and products.

Their products include sportswear and clothing items helping with circulation issues, pain relief and rehabilitation and are used across the medical, sport, space, defence and research arenas.

Mr Brownstone says: “The first time we took investment, it was from the Henley Business Angels but more than the money, what was important was the expertise and the encouragement I received from them in those early stages.”

He agrees that now is the right time to invest in new British businesses and says that he has been investing money himself.

“Times of adversity are times for great innovation and this makes it a great time to invest as the UK needs these businesses,” he says.

The best piece of advice he has received from mentors from the Henley Business Angels was not to give up on your ideas.

He first had the idea for Kymira, which is now a 26-people company, in 2006.

After obtaining a degree in animal science at the University of Reading, he founded the company and ran it on his own for the first 18 months.

Mr Brownstone says: “If you have an idea for that long, you should go for it, they told me and that gave me confidence and it’s something I’ve since echoed to others.

“I remember a few times when something set us back, James was very good at being a calm and steadying hand and that was really important for me, especially in those early stages when it’s easy to get excited but also flustered.

“The network that we created with the Henley Business Angels is very powerful and that experience was pivotal for me. Since then the company has been growing steadily.”

As for Mr Malone, he now teaches his children about money.

He says: “I think it’s really important to do that from a young age and talk to them about saving and investing money, making sure they understand how it works.

“I definitely think that it should be taught in schools from very early on.”