“Entrepreneurs form the backbone of the British economy”

The organisation takes a minority stake in all the companies it invests in, providing them with the tools needed for growth, from funding to expertise, while allowing businesses to maintain control and set their own course.

In the third of our series of articles for Coutts Entrepreneurs Month, we speak to Stephen about the businesses he backs, how entrepreneurs should navigate uncertain times and the best ways to scale a business.

Q. Why does BGF back entrepreneurs?

Stephen Welton: We know that entrepreneurs form the backbone of the British economy and we are here to continue supporting them, especially now through these uncertain times.

Entrepreneurs are defined not simply by their business know-how or their connections, but by their attitude and resilience. ‘Uncertainty’ is a word that strikes fear into the hearts of many. But entrepreneurs? Absolutely not. Disruption is often a by-product of both uncertainty as well as innovation. Think about the green agenda for example.

Forging your own path, creating a business you believe in from scratch, is something courageous, and succeeding means adapting to the winds of change, whatever they may be.

Q. What are some of the most impressive companies you’ve come into contact with recently?

Stephen Welton: Over the past 12 months, I have met countless entrepreneurs finding new ways to innovate and expand, from tackling Britain’s housing crisis, to using data to help manage budgets in the NHS, expanding British education overseas, and developing new technologies for driverless cars. These are firms with the potential to realise the financial rewards of progress, and drive globally transformative innovations.

Q. What are the best routes entrepreneurs can take to scale their business?

Stephen Welton: For many entrepreneurs, there comes a time when they want to push hard to scale their business, to help realise its value and potential. They want to provide opportunities for staff and secure their future. They have ambition at one level.

Yet I am always surprised by how many have never even considered seeking investment as a key part of fulfilling their plans.

We know that most founders and business owners know their company and markets like the back of their hand, so they already have a strategy. The big consideration comes down to how they fund their growth – because that often starts with fears about dilution and loss of control. This can mean that who or where to get investment from is frequently an emotional decision.

Bank loans consequently remain the first choice for the majority of companies as an apparently simpler and cheaper route. These carry many advantages, including not requiring you to give up a percentage of your business. But all too often they are being used by those with higher-risk profiles or on projects where equity investment is a more suitable alternative. Like most things in life there is no right answer, but a balanced approach to funding, mindful of potential ‘bumps in the road’, is both prudent and smart.