Barclays has launched the Demo Directory, a free online service open to UK businesses, regardless of who they bank with, for easy, cheaper and less time consuming access to capital by connecting them to a network of attested investors.
The service, a first-of-its-kind for a UK bank, aims to help businesses seek investment opportunities that they previously may not have explored, which could help them through a difficult trading environment, or be used to grow their business. Barclays research reveals that two-fifths (42 per cent) of founders surveyed would use investment to expand their product and services ranges, 33 per cent hire more staff, and nearly the same amount would expand or upgrade their premises (32 per cent).
Barclays Demo Directory alleviates major barriers for many businesses seeking investment, as research shows that nearly half (49 per cent) of founders of high-growth businesses surveyed felt that their business location restricts their access to investors and funding and 58 per cent feel the costs associated with raising investment has prevented them from seeking sources of capital in this way. Demo Directory solves this with a free online platform to connect founders with investors from anywhere in the country.
After two years of Barclays Demo Directory running via newsletter format, analysis of data has found that the platform could be helping minority and previously underserved groups access investment4. Fifty-four per cent of applicants identified as being from ethnic minority backgrounds, 39 per cent female founders and nearly half (48 per cent) were based outside of the Golden Triangle (Cambridge, Oxford and London).
Barclays Demo Directory allows investors to sign up and review a directory of video pitches and answers to elevator pitch style questions with founders showcasing their businesses. Investors can search for investment opportunities by filtering businesses, for example by region or business size. Barclays Demo Directory service connects investors directly with any founders they want to explore further to discuss funding opportunities.
However, the research also found that economic uncertainty is impacting funding plans, as almost a quarter (24 per cent) of founders surveyed report that they have postponed a funding round due to the current economic environment. This is despite the same number (24 per cent) saying additional funding would help their business to manage bill increases and almost three in ten (27 per cent) saying this would help with cashflow challenges due to the cost-of-living crisis.
Benjamin Storey, Head of Demo Directory at Barclays, said: “Whether businesses are seeking investment to grow or to weather the increased cost of doing business, we want to make it as easy as possible for them to connect with those who can provide the capital they’re looking for.
“We’ve already seen there’s real appetite for the service. In the 24 months where we made business and investor connections through our newsletter version of the Demo Directory, 49 per cent of founders have raised money within the six months of being on the Demo Directory. What’s more, 48 per cent of the businesses showcased were located outside of the ‘Golden Triangle’ of London, Cambridge and Oxford. We can’t wait to see this grow further as we launch our online platform.”