UK entrepreneur Nick Hungerford has revealed the lengths he had to go to in order to raise the money required to launch his London-based financial technology (fintech) company, Nutmeg.
The 34-year-old Nutmeg founder told the BBC that he pitched his business idea to 45 Silicon Valley investors before one finally offered to provide him with the capital he so desperately required.
Many UK entrepreneurs, including Huddle's Alastair Mitchell, head to the San Francisco Bay Area in a bid to tap into the deep pockets of the venture capital firms but it's not always as easy as they think.
"It was horrible," said the Englishman. "The feedback was very personal.
"Some investors said they liked the idea, but that I couldn't do it. Others said they didn't like the idea, and some simply said I wasn't good enough.
"It was really brutal, I hugely questioned myself."
46th time lucky
Hungerford secured his 46th investment meeting with Tim Draper, an early investor in Hotmail and Skype worth an estimated $1bn (£620m).
Draper liked the sound of Nutmeg and decided to invest. Other wealthy investors followed suit and before long Hungerford had “tens of millions of dollars” to launch his company.
In early 2011, Hungerford returned to the UK to launch Nutmeg in South London.
The investment management platform invests people's savings in everything from shares to property, and bonds to currencies.
What sets Nutmeg apart from its rivals is the fact that it’s purely online. This means that Nutmeg customers simply need to log in online to view their investment portfolio, thereby eliminating the need to speak to an investment manager at a large bank, or rely on a statement sent out in the post every six months.
Hungerford said that Nutmeg has significantly lower overheads than its rivals due to the fact the company is based out of a relatively modest office on the outskirts of Central London as opposed to a swanky one in the Square Mile.
According to Hungerford, this allows Nutmeg to charge substantially lower annual fees – as low as 0.3 percent compared with an industry average of 1.37 percent.
Nutmeg also allows people to invest as little as £1,000, as opposed to the minimum of £500,000 many large investment management firms require.
"Historically this industry was only open to the very wealthy, but we want to democratise investing, to open it up to far more people," said Hungerford.
Following its launch in 2013, Nutmeg now claims to be one of the fastest growing financial firms in the UK, having accumulated 35,000 customers since opening its doors.
Hungerford graduated with an economics degree from Exeter before working in investment banking at Barclays and Brewin Dolphin.
"I could have stayed working in the City, but I realised I wasn't particularly fulfilled with my life," said Hungerford.
"I got the entrepreneurial bug, and decided I needed to go to business school to learn how to run and grow a business. "
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