North Wales businesses benefit from innovative Dragon Seed Fund with x√©nos’ support
Two Bangor start-ups have secured a six figure investment from the Dragon Seed Advantage SEIS Fund (Dragon Fund) which invests £50,000 to £150,000 in high-growth Welsh start-ups trading for less than two years.
The Dragon Fund, which is managed by London-based Seed Mentors, was the first Seed Enterprise Investment Scheme (SEIS) specifically to back Welsh businesses.
The companies – MoodMwd and Bloop – were both introduced to the fund by x√©nos, the Wales Business Angel Network.
Seed Mentors and x√©nos have worked together since the Dragon Fund’s 2013 launch to select some of the best investment proposals on offer in Wales.
MoodMwd: £136,000 equity investment
Launched by local entrepreneur, Gemma Hughes, MoodMwd is an innovative provider of educational tools.
Miss Hughes spotted a gap in the market for her award-winning educational products which help to develop children’s emotional intelligence.
A £136,000 equity investment from the Dragon Fund has enabled Miss Hughes to develop, manufacture and market her products to both parents and schools.
The investment also provided an injection of working capital and funded a move to new offices.
“At MoodMwd we’re passionate about children’s health and well-being and we believe that developing their emotional intelligence from an early age is crucial and can have a long-term impact on their behaviour as well as their relationships with adults and other children.
“I’ve wanted to start my own business for some time, securing this funding has allowed me to get off to a good start and invest in key areas of the business. Nick, my local x√©nos manager gave me some constructive advice on my pitch before I pitched for funding at the Dragon Fund forum,” Miss Hughes explained.
Bloop: undisclosed equity investment
Bangor-based Bloop is the first company to sell Bubble Tea, a frothy Taiwanese tea-based drink, in North Wales and the North West of England. First launched in the 1980s, Bubble Tea is growing in popularity worldwide.
Bloop is using an investment from the Dragon Fund investment to develop its brand, ramp up its marketing activities and also to recruit additional staff. Its first shop opens in Chester on 11th September, with further openings planned in Bangor and Blackpool.
Commenting on the importance of the investment, Director, Kala Krishnanmurthi said: “Bubble tea has been a best seller in Asia since the 1980s and its popularity is now growing in the US and Europe. It’s just breaking into the UK, so we’re really excited about bringing it to North Wales and the North West of England.
“Working with Nick Bradley from x√©nos we were able to strengthen our business plan and enhance our pitch to investors which helped us to secure the funding we needed. Since receiving the funding we’ve been able to accelerate our plans and also take advantage of Seed Mentors’ support and expertise.”
Welsh companies receiving investment from the Dragon Fund have also benefitted from Seed Mentors’ specialist advice on a range of business issues including accounting, IT, legal, marketing and tax.
Harvey Shulman, Director at Seed Mentors said: “At Seed Mentors we’re dedicated to the growth of start-up and smaller companies and we specifically created the Dragon Seed Fund to provide Welsh start‚Äîups and early stage businesses with the support and growth funding they need. MoodMwd and Bloop are excellent examples of the promising Welsh businesses the Fund has invested in.
“Many companies are still finding their feet in the first couple of years and our experts have a wealth of expertise which can help business owners build their businesses and maximise the impact of the investment they’ve received. We appoint an experienced independent director to the Board of each company we invest in to ensure our support is focused.”
x√©nos introduces private investors or business angels to companies seeking growth funding, with the angel investor accepting an equity share in the business in return for the investment and mentoring the angel investor provides.
Commenting on the impact of the Dragon Fund in Wales, x√©nos manager, David Maas added: “x√©nos has an extensive network of investors from all over the world and we’ve been successfully connecting Welsh businesses with private investors and appropriate funds for many years. Bloop and MoodMwd are both exciting businesses with strong business plans and I’m delighted we were able to work with them and introduce them to the Dragon Fund.
“These types of funds can be a benefit to both start-ups and private investors. The generous tax reliefs the Dragon Fund can offer means less up-front investment is required often leading to breaking-even earlier and gaining higher returns.”