The microFunding® Exchange

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What is the microFunding® Exchange?

The microFunding® Exchange is a unique new three-way funding process. It introduces...
Thousands of Inventors seeking funding with brilliant ideas but no time, or little business experience and money
To
Thousands of Managers with proven skills and experience of making serious money for other people, and who now want the chance to have a real interest in a business
To
Thousands of Investors - ‘Business Angels’ - with the money and motivation to back exciting early stage opportunities, when they are managed by a highly skilled and experienced marketing team
...with the idea that they all make as much money as possible - quickly!

What is in it for me?

Got a great idea but don’t know how to fund it?
The microFunding® Exchange helps fund great business ideas. It really increases the chances of finding money and making it into a serious business success. The rewards are based upon the well proven formula of ‘30 for the inventor, 30 for the investor and 30 for the management’.
It gives you, the Inventor, the chance to:

By finding a sector experienced manager to run their project, inventors give themselves the best possible chance of profit.

What do I have to do?

You will need to complete your personal and contact details on the ‘my account’ page and agree to the microFunding® Terms and Conditions.
To begin the process, you need to register your idea SECURELY and CONFIDENTIALLY on the microFunding® Exchange. You can do this at http://microfunding.marketest.co.uk/
Worthwhile ideas are original and are genuinely believed to have commercial potential.
The idea will be seen by hundreds of accredited, experienced Managers all of whom have signed strict Confidentiality terms.
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What does it cost?

The cost to the Inventor to register through Marketest is just £15.00 including VAT.
After the idea has been selected from the list of Inventions, there may be additional costs payable directly to the Manager depending on what is needed to be done to create a viable Proof of Concept Project, but it is guaranteed to be as low as possible. Most Managers will in any case fund this themselves.
The fee for raising the funds to run the Proof of Concept Project will vary. Currently Angels Den charge £499, payment of which will have to be agreed between the Inventor and the Manager.
Most Managers will expect the Inventor to fund this.
There will be no further costs for the Inventor once the Project has been funded.

What makes a good idea?

When is a brilliant invention also a ‘good’ idea?

Size, Scale and Scope

Does the idea address solving other people’s real problems? Or is it a clever solution looking for a problem to solve?
If it is original can be made and sold profitably and does have a market, how big is the market? Will everyone need one frequently and regularly, or will it sell only occasionally to specialists? Could it become a range or series, or is it a one-off?

Timing

Have you heard about the man who invented the Gas Meter? Brilliant idea, but he died in poverty.
The trouble was that he invented it a hundred years before domestic gas was commercially available, and his problem was poor timing.

Evolution or Revolution

Does it simply modify or improve something already in use so as to make it easier, or cheaper, or quicker, or better? Or, even though it is brilliant, will it mean that consumers will have to change their habits and manufacturers change their production lines? How brilliant would it have to be for this to happen?

Protection

Has the idea been had by others before? If so, it might really struggle to be exploited and even if it succeeds the others might claim a slice of the pie.
Is the idea similar to something else, so that it could be challenged? And don’t forget that the ‘something else’ might not be on the market - big companies have hundreds of thousands of patented inventions stored away defensively, to protect the sales of their other products.

What is the microFunding® process?

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Inventors post their ideas confidentially and securely, without having to commit to any future involvement in starting growing or managing the future business - but keeping a large stake in it.
Managers with a broad range of commercial skills have secure access to these ideas, and subject to strict confidentiality select those that in their judgment and experience have the best profit potential. For this, the Manager can grow a business in which he has his own large personal stake.
The critical part of the process is the Proof of Concept Project. By eliminating less viable inventions and identifying the winners early at little cost, the Proof of Concept Project gives Investors the chance of real Rewards at reduced Risk. So the Manager's first task, at his own time and reputation risk, is to specify what the ‘concept’ is and its proof by whom, by when, at what cost and to what criteria. The Manager is expected to use approved suppliers for much of this work, and while he will also cost his time it is unlikely that he will attract investors if the project’s cost is excessive.
Investors from Angels Den - again securely and confidentially - have access to those ideas preselected by the Managers, and give their financial backing to the projects they choose. By backing the skills and experience of the Manager, rather than the idea alone, they greatly improve the risk reward ratio of investing and so have a far better chance of profit while absolutely limiting their downside.
The responsibility for the success of the project and ensuing business is wholly up to the Manager.
He has sole discretion over the strategy and its implementation, including personnel. The inventor may be required for his technical input, or not; it is up to the Manager.
Investors are guaranteed to be able to back the successful projects, or if they wish they can sell their investment rights for an early, smaller, profit.
If a project is successful, Inventor, Manager and investor each have a minimum guaranteed share of the success. If in order to become commercially successful both Manager and Investor have to risk more time effort and money, the guaranteed minimum share is 30% for each of the three parties. Because the Managers’ shares are held as options, they can’t realise anything before achieving a cash exit and so have a real incentive to work towards this goal as early and as profitably as possible. If however the Manager can arrange a profitable Licensing deal, with considerably lower risk for himself and the Investor, only half is split into three so the guaranteed minima of the ensuing business are that the Inventor takes 60% and the Manager and Investor 15% each.

The process – in detail from the Inventor’s point of view

What documentation is required?

To apply to microFunding®:
A good original - and hopefully commercial - idea
Complete the ‘New Invention’ details on the website
When a manager applies for a project:
Inventor will receive a signed Project specific Confidentiality Agreement
Inventor will receive a copy of the managers CV
Re-confirm agreement to the microFunding® Terms and Conditions
To post a project on Angels Den:
Nothing, but the cost of posting (currently £499) must be met between the Inventor and the manager
To manage a funded project:
Subscription Agreement documents completed between Inventor Manager and Investor(s)
All documents prepared by solicitors B P Collins of Gerrards Cross and available for inspection.



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