One of the little oddities about English law is that you can go and ask anyone you like to invest in your adventure.
You don\’t have to, as in the US, file paperwork and agree to certain restrictions. You can just ask people \”would you like to buy some shares in my company\” and if they say yes, take their money.
You\’re bound by the usual restrictions of course: doing what you said you were going to do, telling people the truth, reporting the accounts to them at the appropriate times and so on.
But there\’s no need to go through a public market or anything, hire huge numbers of lawyers and accountants. You can simply explain the idea and see what people think about it.
And I\’m rather wondering whether it might be possible to use this here internet thing as a way of raising that sort of funding.
I\’ve an idea in the metals field. Rare earths, not directly to do with scandium.
There\’s an obvious market need or niche. There\’s a technology that\’s well known in another part of the metals world. Lab work shows that it should work with rare earths. If it does it would cost some 10% of the current method. Global market\’s around $500 million a year (ie, this is what the old technology currently costs the people who use it).
Back of the envelope stuff suggests that £300,000 or so would be needed to properly prove the concept. £1 million or so to build a working prototype.
The basic metallurgy is, as I say, well known, there are several large industrial processes that use the halides to purify ores and metal salts: it\’s just that the halide metallurgy of the rare earths isn\’t all that well known.
Except, one of my customers, and a company that has agreed that this is an interesting idea worth pursuing and would work with us in doing so, is the world leader in the rare earth halides.
There\’s absolutely no point at all in trying to go to AIM or the TSE for this sort of sum. You\’d spend that much in getting a listing. It\’s all a bit off base for institutional investors. Mining investors like mines, not technologies. Technology investors don\’t like mining.
So I\’m wondering. What does anyone think about trying to crowd source this sort of sum of money? 1,000 people with £1,000 each? Or multiples of that per person if they desire?
30% of a new company divided among the financial investors?
There\’s the obvious point that the technology might not work. Or that someone else will get there first (although I know of no one working on it). Plus of course the distinct possibility that I\’ll entirely screw it up.
The thing is, I\’m absolutely certain I could, with a well crafted idea (and I do have another one which is much more in this sort of range and that might be a good one to start with) raise £50,000 or so through this blog under that sort of arrangement. That smaller idea being that there are no internet sellers of prescription glasses in Portugal or Portuguese. But it\’s easy enough (and I\’ve already got an agreement set up) to get people to manufacture to a prescription in China. And such glasses in China cost $10 or so (I wear them myself) and prescription glasses in a store in Portugal start at €100 a pair.
But what do you think about that larger sum? Or even the smaller sum?
Both are obviously ideas that have a high risk of total failure.
But tell me what you think.