Local software developers now have a new option to gain funding for the next phase in their growth cycle.
UK-based private equity firm Business Consulting International (BCI) has set up a local branch to find software companies here it can help fund.
The operation is headed by Rhys Taylor, who has been in the industry for 12 years, having worked for Telecom, Datacom and most recently as a relationship manager at Axon.
This experience and knowledge of the local industry, combined with his existing relationships, has helped the venture get off the ground, says Taylor.
“So far we have been able to rely on word-of-mouth. The great thing about this country is that everybody knows everybody.”
While in its third month of operation the company has not done any marketing yet, but has already looked at investing in around 18 local companies.
However, BCI is yet to sign its first investment deal, says Taylor. “We are still looking, but it is early days. There is a wealth of talent out there – it’s just a matter of finding it.”
BCI follows a simple model, with backing from a sizeable portfolio of investments in the UK and Europe, says Taylor. “Our model is to come in as an equity partner. We tend to provide capital where needed for companies to reach their next milestone. Our model is easy to explain – we have the experience and are clear about what our expectations are and how we can help.”
The company will focus predominantly on software companies that already have a commercially proven product, which can be replicated across a number of markets and does not plan to invest in start-ups, says Taylor. “We like to get involved in the next phase, where they know they can make money out of their product and need funds to grow their market.”
BCI takes a shareholding in the companies it invests in, but intends to remain involved for only three to four years, adds Taylor. “We come in with a planned exit strategy.”
Although the company does not focus just on technology firms overseas, it does so here, as this allows Taylor to draw on his skills in this field. “We tend to pick types of companies that we understand how they work.”
The company differs from venture capitalists in that it invests private equity, says Taylor. “Venture capitalists have a fund of other people’s money that they invest.”