How I’ve grown my business: Damon Bonser, CEO of British Design Fund

Damon Bonser, CEO of the British Design Fund, talks funding and the key challenges the company has faced since it launched

Inspired by his first product business, Damon Bonser set up the British Design Fund (BDF) in 2017. He had little experience in dealing with essential processes when he set up his firm.

The CEO, investor and mentor started out in business when he was in his mid-20s, after finishing university. Fast forward to October 2019 and the BDF has invested just under £1m into six companies, with the aim of expanding their portfolio over the coming years. To do that, the team (which is made up of five core members) is currently seeking to raise £2m in EIS/SEIS funding.

The British Design Fund gives early stage product businesses access to capital, mentoring and expertise. It also provides mentoring across areas such as sales, marketing, international distribution, IP, contracts, financial planning, design management and manufacturing.   

Where did the idea for your business come from?

I became aware of the huge lack of support and funding out there for early stage product businesses when mentoring at the Design Council a few years back. There were workshops filled with innovative founders working on prototype products to solve real problems, however after the cohorts finished, they had nowhere to go. There wasn’t that combination of early stage funding and support that these start-ups needed in order to successfully take their brand and products through to market.

What experience do you have in your sector?

My own background covers growth stage product manufacturing and launching product brands into domestic and international markets. All of this is done on fairly tight budgets, so I know the pitfalls that cash-strapped product start-ups face and importantly the ways to navigate these pitfalls without running out of cash.

The rest of the team bring a huge amount of experience across the design and manufacturing sectors, whether that be legal and IP protection, licensing and brand or finance and sales. All of the businesses that come through British Design Fund receive not just funding but also get access to the core team and the wide network of mentors that support us.

Do you consider your business to be a disruptor? What’s its USP?

The British Design Fund has two headline USPs. Firstly, to the exclusion of all else, the Fund only invests in business that have a physical product which requires an element of manufacturing. Secondly, we are very hands-on and the level of support we give goes beyond that most other funds offer.

We believe that it’s not just cash that will make a difference, but also tailored support which helps those early business launch into market with the best chance of success and best chance of hitting those growth forecasts.

What part does technology play in your business?

We would not consider ourselves a tech driven business. However, just like all other forward-thinking ventures, we embrace technology to amplify our message and help deliver our service. So social media plays a big part in how we find and attract potential new deals to consider for investment, and our initial application process is largely automated.

But beyond that, we are very much a people driven business; much of the knowledge we pass on comes from the team. We passionately believe that the start-ups we support need us to roll up our sleeves, not just chair monthly board meetings with them.

What funding did you have to start the business and where did it come from?

I invested my own funds to get the structure and vehicle behind the British Design Fund off the ground, and then attracted over 140 investors to join the 1st fund itself. These investors into the first fund came from a mixture of people that had worked with me before – or investors passionate about British design – as well as friends and family, of course.

As the business has grown, what major challenges have you faced and how have you overcome them?

Our biggest challenge has been to get our message out to as many relevant people as possible, be it investors, partners or potential investees. We are doing something different at the British Design Fund and this means that it takes a while to educate the market on our approach.

It has helped that a number of the investees from the first fund are performing well and getting press coverage –this further endorses our hands-on approach. As well as this, we have spent a huge amount of time talking about the merits of supporting product-based businesses here in the UK, and our unique approach to scaling them without running out of cash.

It has taken a couple of years, and the job is not yet done, but we are seeing a growing recognition that this important part of our economy needs to be supported and can offer attractive returns to investors.

Have you turned to external finance to grow? If so, what type – debt or equity?

As yet we remain self-financed, but we will be raising equity capital this year in order to scale the British Design Fund, offering as more funds are launched over the coming years. We want to maintain the quality of support we offer, whether we have ten or a thousand companies across the portfolios.

What would you say to any other business owners mulling whether to bring in outside investors?

I would advise any business owner to think about the kind of capital their business needs. Think about what stage of growth they are at and whether they have validated the market need properly. The type of growth capital you raise will largely dictate the type of investors you should be speaking to.

Not all sources of capital will be right for your business and sometimes it’s better to say just say no, looking at how else you can generate cash without selling equity. However, if you are certain that your business needs external equity investors then have a robust set of financials with upside and downside models. Identify the big risk factors too. Investors know there is risk to businesses, so don’t be afraid to be up front about what this risk looks like in various scenarios.

How do you measure success for yourself, your investors, your staff and your customers?

Ultimately, we are judged by the return we deliver to our investors. We can only do this by investing in and supporting the founders of excellent design-led product businesses. The needs of the businesses change from case to case and evolve as they grow.

Mentoring is a large part of what Damon and the British Design Fund do

Likewise, the demands placed upon our team at the British Design Fund changes and the best way to ensure that these demands are met is to foster a culture of sharing and learning across the teams and the businesses we support.

What business (or personal) tip would give to other entrepreneurs hoping to grow their businesses?

Make sure there is a genuine and scalable need which is driving your business or business idea.

Who has most influenced your working life?

I have some amazing mentors, business partners and investors that have all driven me to try harder and do better. Even more so, I have been lucky enough to have a hugely supportive wife and family. None of this would be possible without their support.

How do you relax outside of work?

With two kids under five there is almost no time left in the day to relax. However, any thin slice of free time that I do get is usually spent in the gym, in the garden or sitting at home doing a crossword.

Damon Bonser is co-founder of British Design Fund and a member of the Growth Business Venturers Club. To find out more about becoming a venturer, see here

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Anna Jordan

Anna is Senior Reporter, covering topics affecting SMEs such as grant funding, managing employees and the day-to-day running of a business.

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