Justin Urquhart Stewart
Congratulations Justin on getting involved in the new start up. Can you tell us a bit more about Regionally, what it will do and your role?
We’re a new investment service for private members who are not all professional investors but rather ‘pre-qualified’ investors, high net worth individuals, self-certified investors, professional investors, institutional investors and syndicates. We work on two core principles. The first, to restructure and semi-automate investment processes to deliver an online service that offers a more cost and time efficient route to accessing growth capital, whilst maintaining the highest standards that allow our investor members to invest confidently. Secondly, and strongly insinuated from our name, we are focussing on bringing together local, national and even global investors with regional businesses. The idea is, that in such a crucial time such as now, post Brexit and during Covid, we need to focus our attention onto maximising the potential of those business opportunities that are looking for investment to scale-up and develop to achieve their potential, yet so far lack the mechanism to effectively access funding. We are putting in place some much needed investment ‘plumbing’ infrastructure to redirect and facilitate more investment capital into regional businesses.
What sort of firms will Regionally invest in and will it potentially invest in financial services firms including Financial Planning and wealth management businesses?
Regionally doesn’t invest itself, however we are that financial plumbing that brings together those pre-qualified investors, including professional investors, family offices, syndicates, angel groupings, local pension funds and even institutions with the relevant investment opportunities in the UK regions. The criteria for these opportunities are fairly simple. Firstly, they need to be based or intending to be based anywhere in the UK except for London. Secondly, they need to be at an SME size. Excluding start-ups makes the opportunities we offer less risky, an element that differs Regionally from other investment ‘platforms’ (for want of a better word!). Lastly, these businesses need to scale-up. Most UK scale-up businesses are actually based outside of London, so it really shows the demand for funding in the regions. Indeed, we are sector agnostic and are therefore very open to facilitating investment in financial services firms and Financial Planning businesses. If they fit the criteria, and their application and due diligence process is successful, then as long as they get sufficient interest from our network of investors, then they will be able to receive funding.
Who else is involved in backing Regionally and how much do you expect to lend or invest each month (is it investing or lending by the way?).
We’ve received an immense level of support and interest from across many industries and from around the UK. Primarily, working closely with several Chambers of Commerce across the country has introduced us to some really interesting and reputable businesses. We work with local accountancy and solicitor firms who act as regional advisers, so the last few months have been brilliant for getting to know these parties.
Regionally will offer equity, debt and mezzanine deals. Our first investment opportunities are equity deals, however we will move into lending later this year. In terms of financial backing, we have financed this ourselves to provide a solid capital base for development, launch and growth and without any government or other external funding.
You are looking for HNW investors to help ‘crowd-fund’ some of the investments. How does this work?
We have two stages for the opportunities on our online environment. Firstly, the businesses (once they have successfully undergone a thorough selection and due diligence process) are on our ‘Upcoming Investments Opportunities page’. At this point, investors can register their interest. We have also created a functionality that allows an investor to apply for a governance position, where made available by the business. The registration of interest levels allows us to assess the popularity of the opportunity. The business moves from this marketplace to our ‘Live Investment Opportunities’ page after a live webinar when the business can present themselves and what they are looking for from investors. The investors will then have the opportunity to pledge, in a contractually binding process. While in a way this is like ‘crowd’ funding, we prefer thinking of it as a smaller group of well-informed investors, each investing relatively large sums at each point, and investing in well researched businesses.
Is there a role for Financial Planners and wealth managers in working with Regionally?
Indeed, Financial Planners and wealth managers are integral to our business model. We know that Financial Planners and wealth managers are often working with clients who have an affinity perhaps to a particular area of the UK or a reason to invest in a socially conscious way. We hope that these professionals can connect their HNW clients with. Additionally, we welcome the opportunity for them to work both as a regional partner or a member on the platform.
Will you use EIS and VCT structures?
Yes, we will have EIS and later stage VC investment opportunities available to our investor members.
Is Regionally just for firms outside London?
In theory, yes. However, if firms have the intention to work in the Regions or will evidently be improving the economies of the Regions then of course we’d love to hear from them.
Some might say that this area is well served by the banks and government support schemes. Is there anything different that Regionally is doing? What are the fees and charges?
Regionally has been designed to fulfil demand from growth businesses for direct investment (equity and debt) and to allow companies to structure themselves with the right shareholders for the longer-term investment and development of the business. Also, the structure will allow companies to have the ability to have their shares traded on a ‘matched order’ basis as and when the companies wish to allow such transactions and allow both sales and purchases as requested by investors.
Additionally, we have wanted to harness the knowledge and expertise of regional corporate advisers in each area. Often, they have found that as their corporate clients grow, they end up losing them to London-based advisers. Our fees are very straightforward and are primarily just a percentage of the amount of capital raised. There is additionally a small charge to cover the cost of maintaining the company on the platform or listing.
How has life been since retiring from 7IM? You are still a 7IM ambassador but what other projects are you involved in and do you ever plan to retire fully?
Gosh what a change! I had forgotten that I was getting so old. Anyway, it has allowed to me to focus on other ideas including Regionally and also Investors In The Community (IIC) which has been designed to ease employee and company charitable donations (without costs being deducted) while rewarding donors and participants with ‘Community Credits’ to recognise and reward their efforts. I am also going to continue my work on Economic Archaeology which basically looks to compare the economy of the Roman and Iron Ages with today. As my wife told me "go out and find some relics before you become one" - I may be too late!
How do you relax in your spare time?
Relaxing? I do no such thing. I jest, my relaxing is spent well with my three Burmese. Cats, unfortunately, not women. I also spend much of my time on a vast project, doing up a beautiful old house (1688) in west London, which presents a huge quantity of issues day and night as I’m sure you can imagine. As time has passed there has been an increasing amount of creaking and structural adjustment, but that is just me - the house is fine!
Justin Urquhart Biography: After an early career that included work in the vineyards of Europe, the docks of Southampton and finance in Asia, he went on to establish Broker Services, which became Barclays Stockbrokers. Together with Tom Sheridan, he founded 7IM and worked as head of corporate development. Currently, he is chairman of Regionally, a company recently co-founded by himself and Jim Odell. He is a long term supporter of the Financial Planning profession and financial education.