ELITE: London Stock Exchange Group's capital raising programme
Deciding on the next funding step for your business can be difficult, with a variety of options available and each with its own advantages and disadvantages.
And while you may be able to find a suitable option for you, getting your business investor-ready and into a position where you give yourself the best opportunity to succeed isn’t always simple or obvious.
That’s part of the reason behind London Stock Exchange Group’s ELITE initiative, which helps businesses connect with capital through a combination of education, business support and mentoring and access to expertise and funding.
Luca Peyrano, CEO at ELITE, said: “Our mission is ‘Connecting companies with capital’. Because we know that it’s not just asking for money.
"There’s searching for new business opportunities. You need to have a business plan available. You need proper structure and governance in place. You need to know how to communicate with investors. You need to understand the ‘food chain’ of the financial industry.”
ELITE aims to do that through a mixture of training, best practice advice and content. It’s not centred purely on making a business IPO ready, but instead its focused on multiple forms of finance and giving management teams the confidence to navigate them.
“We offer companies the possibilities to get trained, to get some coaching from us and our 150 advisors and a dedicated environment which can be used as a stepping stone for raising capital for growth,” says Peyrano.
“We decided to take a relatively neutral approach. Elite is not intended to channel companies into the public markets only but to offer a number of options, from private equity to venture debt and IPOs, that might get the companies closer to external capital. We see this as the first step.”
“The average size is closer to £20m. The companies suited to ELITE are looking at their ambitions and looking to assess what their next steps are; asking how they can grow better.”
Luca Peyrano CEO @ ELITE
ELITE focuses on businesses that have a turnover of at least £5m
ELITE focuses on successful businesses. It’s not for start-ups but businesses who are already scaling and are looking for ways to grow better, as outlined by Peyrano: “We look for companies that have a serious appetite for growth, who already have a vision for growth.
“That could mean internationalisation or an extension of product lines, but we tend to focus on ambitious companies with a serious ambition for doubling or trebling in the next few years.”
“The majority of businesses on the programme are from the regions. We link a lot of people to local mentors. We also do things like roadshows and regional events to make sure we are connected to the exciting businesses across the UK.”
How is ELITE structured?
ELITE is designed to help businesses put the structures in place to scale up efficiently through specific modules with each looking at a different challenge for scale ups, as well as through dedicated events.
Umerah Akram, Head of ELITE UK and International @ ELITE, said: “Each module targets a specific challenge that every company faces, including growth strategy, talent management, funding needs and funding for growth.
“We also look at innovation and technology and how that can make processes more efficient as well as the advantages and disadvantages of different forms of capital and exits, including IPO, venture capital and trade sale.”
“In every cohort, there’s always a situation where you have a company that does manufacturing in Scotland and they sit opposite a tech company based in London and they talk about the challenges they have and realise that although their underlying businesses are completely different, the principles they use can apply to their own industry. It’s quite valuable to have that.”
Another important aspect of ELITE is collaboration. Each of the programme’s cohorts are typically made up of 20 businesses. And with each cohort going through an 18-month programme, there’s lots of opportunity for businesses to interact and learn from each other.
“Within the cohort we always make sure there are no direct competitors,” said Akram. “This is to ensure open discussion, sharing of challenges and learning from each other.”.
“We always joke quite a bit that it becomes a bit like Entrepreneurs Anonymous because being a CEO is actually very lonely, so having that space where you can actually come in and you know there are no direct competitors and you can have a properly navigated discussion about your business challenges and sharing that is actually invaluable.”
“In the UK alone, companies have raised nearly £2bn between 140 companies.”
What impact has ELITE had on companies that have taken part?
Graze and SkyScanner are just two of the 900 plus businesses that have been through ELITE and raised more than €7bn in transaction value since the programme was established in 2012, with over £2bn raised in the UK alone.
And interestingly, 15 of those businesses have gone on to list on the public market.
A company’s success is ultimately driven by a range of internal and external factors. ELITE aims to give management teams the tools and confidence to reach their potential.
How can businesses get involved with ELITE?
Businesses can express an interest in ELITE before going through an admission process which involves discussion with the ELITE Team about your growth to date and future ambition and completion of an application form to be reviewed by an ELITE admissions committee.
Businesses pay £20,000 to enrol on the programme, something ELITE thinks is key to ensure commitment from those involved.
“We think our companies need to have skin in the game to ensure commitment as ultimately the companies’ participation and contribution ensures the quality and value of ELITE,” said Akram.