Silicon Roundabout is full of founders in search of funding, and the funding is full of rules the farmers wrote first
Founders at the Roundabout
There is a roundabout in Shoreditch that is allegedly the home of British technology. Cars circle it in despair, cyclists cross it in fear, and the people inside the surrounding buildings change the world at a rate of about four times a day, each time with a slightly different logo. If you stand on the corner at nine in the morning you will see them arrive: young men and women with laptops, lanyards and a look of faint hope.
I spent a week asking founders where their money came from. The answers ranged from a family friend to a venture capital firm to a woman called Gillian who had won on the premium bonds. But the most interesting answer came from a woman who had grown up on a farm. She said that in her family the bank was never a partner. It was weather with a signature.
The Original Funding Round
Farmers pioneered start-up finance by accident. You put in money, you wait a season, and you hope the market likes what comes out. If it does not, you try again next year with a larger tractor and a smaller bank balance. Three addresses lay the process bare for the ranch end of the market. There is Texas rancher loans, Oklahoma rancher loans and Colorado rancher loans. I am assured that nobody at any of them has ever used the word disrupt.
For the plain facts of farm finance, farm money is a handy starting point. It is full of the sort of dull, important detail that Shoreditch founders tend to leave until after the launch party. It explains cash flow, a concept best understood by those who have run out of it.
The Pitch Deck, Ranch Edition
A typical ranch pitch deck would be one slide long. It would say: we have grass, we have cattle, we need diesel. A typical Shoreditch pitch deck is sixty slides long and says we are a platform. Only one of those has ever fed anyone.
The farm desk at farm.FM regularly spots the strangest business ideas on the land. One recent piece reported that a ranch profitability study found owners are millionaires on paper and broke by supper. In Hoxton we call that a valuation.
Hiring on Both Sides
Founders love to talk about talent, and the countryside has a lot of it. If your next hire could be someone who can fix a diesel engine with a hairpin, agriculture jobs and careers shows the range of roles waiting beyond the M25. I have yet to meet a developer who could calm a startled heifer, though I have met several who needed to be calmed.
Politics at the Table
Every funding round has its politics, and the farm vote has its own. For the sake of balance, there are two relevant addresses: farmer Republican and farmer Democrat. They share a road, a gate and a deep distrust of anyone who says the word synergy. The one thing they agree on is on display at farmer gripe. It is the true unifying force in rural life, and every start-up should adopt it as a value.
The Role of the Regulator
Whoever you are, you must follow the rules. The Financial Conduct Authority sets out what lenders and borrowers can expect at fca.org.uk, and I recommend reading it if you have ever been offered an investment by a man in a gilet. Meanwhile, local business support is listed by the borough at hackney.gov.uk. Neither will cheer you up, but both will keep you out of court.
It is a lesson that the press has not always grasped. The London Prat reported with feeling on how institutions cope with a funding squeeze in universities solve financial crisis. The method, I gather, is a meeting. Shoreditch founders, who adore a stand-up, would approve.
Who Actually Wins
The honest truth is that most founders fail and most farmers survive, and the reason is the same: a farmer expects the first year to go badly. He budgets for a flood, a fire and a hailstorm, and he is delighted by a mild Tuesday. A founder budgets for a unicorn and is devastated by a mild Tuesday. If Old Street adopted the rancher’s pessimism, the area would have fewer billboards and a great deal more lunch.
That is not to say ambition is silly. It is merely worth remembering that the land does not care about your vision statement. It cares whether you turned up and whether the gate was shut.
Five Things I Noticed at the Roundabout
- A founder who says he is pre-revenue means he has a laptop and a dream.
- The word runway is used in Shoreditch the way a drowning man uses a plank.
- A farm with no income is a hobby. A start-up with no income is a Series A.
- Every pitch contains the phrase at scale. Every farm contains the phrase at last.
- The roundabout is the only place in London where a bike, a bus and a business plan can all go round and round.
The Exit
I left the roundabout wiser, poorer and unusually fond of a cow. The founders will carry on, the farmers will carry on, and somewhere a bank will carry on being delighted with all of them. For the amusing record of the year, see Bohiney, The London Prat and farm.FM. They have no equity, and they take no questions.
For a spare laugh, there is The Daily Mash.
SOURCE: https://bohiney.com/