BELFAST BRIEFING:Newly formed Lough Shore Investments plans to take 10 companies all the way to the top
SOMEONE SHOULD be thinking about buying entrepreneur Danny Moore a suit this week. Not one of the pin-striped variety but more along the lines of the kind super heroes prefer.
Moore may not yet be immediately recognised on the street as one of the good guys, but give him time and he might just become one of the North’s first economic action heroes.
Moore, for those who might not already be aware of his good deeds, is a former chief executive of NYSE Technologies.
It is the technology arm of NYSE Euronext which operates the world’s largest exchange group and includes the New York Stock Exchange. Moore had previously been the chief executive of American-owned but Belfast-based Wombat Financial Software, acquired by NYSE Euronext for $200 million (€146 million) in 2008.
In that role, he helped create hundreds of jobs and established the company’s reputation as a leader in the global market data, messaging and trading technology sectors. Now his self-appointed mission is to help other entrepreneurs and companies become world leaders.
Moore has set up Lough Shore Investments, a “small investment shop” which he says “will be closer to what is now being termed a ‘SuperAngel’ fund than venture capital or private equity” fund. He says its objective is clear.
“Lough Shore Investments’ mission is to invest in high-potential management teams and partner with them to build great businesses. Our goal is to bring 10 great companies to exit or IPO by 2025.”
Moore firmly believes he will achieve this because the mission is built on three aspects of his personal business philosophy.
The first is a belief that great businesses always begin with top-class people.
He claims the first 10 people in a new business (or probably the core 10 in the first 25) “are the single biggest determinant in the company’s medium to long-term success”. Speaking from experience, Moore says that, aside from increasing the probability of its success, “high-quality people also tend to be a lot more fun to work with”.
His second philosophy is that any relationship should be a win-win for the investor and the founding team (including staff).
“A great company will make it possible to buy in at the right level. Keeping the investors, founders, management teams and staff aligned is core to maximising the probability of success.”
Third, according to the man who once rang the opening bell on the floor of the New York Stock Exchange as chief executive of Wombat, it should be the ambition of every chief executive to ring that bell having brought his or her company to a successful initial public offering.
“Very often entrepreneurs see an exit or IPO as the end of the road, an opportunity to cash out – and it often is. However, the IPO process is really about raising capital and tapping the resource-allocation machine within the global markets. A good IPO is much more akin to a graduation to the big stage.”
He says it is these goals and principles which will be at the heart of Lough Shore Investments, which does not plan exclusively to invest in the North.
Moore is confident that despite the grim economic environment in Northern Ireland there is much local potential. “I believe in Northern Ireland we have some of the most talented and highly motivated people in the world. We have some great home-grown businesses but the truth is we should have far more.”
He has not disclosed what level of capital he is prepared to invest in total but Lough Shore Investments has, according to Moore, already invested in its first tech start-up and plans to announce the first round of investments in the coming months.
Perhaps there is something in the air in the North because, just as Moore gets his new venture off the ground, Invest Northern Ireland is set to unveil an exciting £46 million investment pot. It is seeking fund managers for two new venture capital funds.
The regional development agency has formally launched the tender process to select managers for a £30 million development fund and a potential £16 million co-investment funding scheme.
The eagerly awaited Europe-wide tender is expected to attract major interest from both local and internationally based venture capital fund managers.
The development fund, which will have a lifespan of 10 years, will support companies seeking investments from £450,000 to £2 million, subject to EU state aid approval. Invest NI is likely to directly commit 33.33 per cent or £10 million on a subordinated basis, with the fund manager expected to raise £20 million from private investors.
The agency will also operate a co-investment funding scheme alongside the development fund. It is believed to have ringfenced £7.2 million as co-investment funding over a six-year period.
According to the tender document, co-investment funding will be provided alongside private investors and business angels where there is an identified funding gap. The deadline for the tender process is likely to be early March, with details announced of the successful candidates shortly after.
