There aren’t many startups that can count Bill Currie and former Tesco CEO Sir Terry Leahy as investors but Vivify is one of them.

The tech firm helps schools hire out facilities outside teaching hours and raised £1m from Arete in 2022, which included high profile investors Currie and Leahy.

CEO Russell Teale said he’s blessed with ‘great’ investors and will be sharing his insights at a business breakfast on April 18th entitled ‘How do you spot a perfect investor from a poisonous one’.

In describing a poisonous investor he said: “They make you feel subservient, happy under their existence, scared to be honest.

“They encourage you to take more money when you don’t need it. They aren’t close to the business, the real business, but they are close enough to the cashflow dynamics to know when to encourage dilution events to serve their shareholder/investor base.

‘They are uninterested. They don’t add value in board meetings or outside of them.”

How to spot a perfect investor from a poisonous one?

Teale is one of eight confirmed speakers for the Sanderson Recruitment event, which is being run in conjunction with BusinessCloud.

Teale said there are three key qualities he looks for in an investor: Funds; industry experience; and complimentary portfolio.

In terms of funds he said:  “Money is great and every startup and scaleup needs it. But with funds comes expectation, therefore the real nuance in the funds point is the trust and support that comes with it.

“No investor gives you money without wanting a return, therefore I would say the perfect investor comes with trust, room to manoeuvre and patience/partnership.

“ROI takes time, making the founder comfortable will promote all of the above. Make them feel insecure, then be prepared to be lied to, embellished and everything in-between.”

He identified the second key quality as industry experience.

“Whilst industry experience is helpful, it can absolutely be a hinderance,” explained Teale.  “Just because investors have invested in a particular vertical or industry doesn’t mean that they have relevant experience for your product.

“You can find yourself being consumed by meetings arranged by investors, ‘meet this guy’, ‘you’ve got to meet this one’, ‘this guy has walked 100 miles in your shoes’, when in reality, they invested in you because you have something unique, not well-trodden.

“That said, my perfect investor arranges genuine intros that can accelerate routes-to-market, that genuinely provide valuable insight, not tenuous links.

“They have the industry experience to increase margin, conversion or help with that next piece of recruitment.

“Having the honest relationship with your investor will give you the ability to say ‘no thanks’ to their suggested intro.

“God forbid they try to cross-fertilise to help their other investments generate revenue when there is nothing in it for you.

“There is a time and a place for that, when you are up and running and you have built a team that enables you to step away from your business to add value to their portfolio.”

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In terms of an investor having a complimentary portfolio, he said: “Just because they have other businesses in your vertical, does not mean to say that they are relevant. Similar to the previous point, it has to work for you.

“In summary, the perfect investor trusts you, allows you to say no. They make you feel in charge, they empower you to make decisions, but they also add value to enable you to ask them for advice.

“They provide opportunities for you to be honest, ask for guidance and potentially deviate from the original plan.

“Being agile and entrepreneurial is what got you there, therefore having an investor that provides the environment to adapt your original plan is a great one – the perfect one.

“In all honesty I have great investors, I can name-drop them to create credibility to new contracts, because it is true. Why would they invest in me unless they believed in me and my product? How powerful is that?

“To know that Sir Terry Leahy buys into me and my team (is powerful). Why wouldn’t a prospective customer be encouraged by that?

“I chose my investors like I recruit team members, normal people, people who are appreciate the working class, people who have values, but also people that have done well for themselves, they earned it in the same way I want to.

“Hard work, doing the right thing and creating something bigger than me. If I get to work with people like that, not to mention investors like that, then it makes the process of starting and scaling a business so much easier.”

The event – ‘How do you spot a perfect investor from a poisonous one?’ – is part of a series of new events between Sanderson and BusinessCloud  called ‘Catch-22 UNLOCKED’.

The event will be hosted by award-winning events host Chris Maguire and will hear from a panel of entrepreneurs and investors.

The confirmed speakers includes Rory Cameron, co-founder and CEO of Gendius, which went into administration in December 2023 after talks with potential investors collapsed.

He’ll be joined by Ste Senior, of Manchester-based baby tech firm, Aibytech, Sam Royle, co-founder and CEO of SoSquared; Glyn Powditch, co-founder of Dream Agility; Elizabeth Gooch MBE; David Levine, principal at Manchester Angels, and Laura Sissons, investment manager at YFM.