Vestd: Ifty Nasir
Asking himself why so many ideas and businesses fail to get off the ground, this entrepreneur created a way to turn start-up equity into currency
Tell us what your business does:
In a nutshell Vestd is a new, game-changing, FCA-authorised collaboration platform that helps entrepreneurs (Founders) turns the equity in their start-up into an easy to use currency with which to reward those who help them build their start-up.
It also helps them find the people (Contributors) with the skills, experience and expertise they need, who are willing “invest” them in startups they believe in.
It’s the first initiative of its kind and completely changes the way start-ups get going. The platform is based on the ‘Equity Economy’, a term we’ve coined, which allows Founders to distribute micro equity from their start-ups in exchange for the expertise their businesses need – from designers and developers to mentors and marketers, and everything in between.
At the same time specialists are given the opportunity to work for exciting new ventures in exchange for real shares in that business.
This exchange mitigates the three key reasons commonly cited for businesses not getting started and/or failing:
- Poor idea/concept – specialists will only invest their expertise in ideas and concepts that they believe in. Consequently, entrepreneurs will very quickly realise if a business plan or model needs redesigning
- Cashflow – many start-ups fail due to a lack of cash. However, because entrepreneurs reward those bringing expertise with equity, the cashflow headache is eliminated
- Lack of skills and knowledge in-house – Vestd gives entrepreneurs access to the expertise their businesses need in order to thrive. The platform already has a large network of specialists that actively want to invest their skills and time in new startups.
Addressing these pain points greatly increases a start-up’s chance of success during its fledgling years.
Our ultimate aim being to help good ideas and entrepreneurs to succeed irrespective of their geographic or economic starting points.
Where did the idea for your business come from?
When you think of how many great ideas never get past go, or fail to grow, you have to ask yourself ‘why?'. That question in my mind was followed by another, ‘what could be done to change this?'.
Hence the idea of revolutionising the way start-ups start-up has been with me for quite a while, having faced many challenges myself first hand as an aspirant entrepreneur back in my early twenties.
However, working with a number of start-ups in more recent years, a couple of observations really stood out:
- Entrepreneurs were chasing cash investment to buy the skills and experience they needed to help them crystallise and grow their businesses. The problem was that they were paying top whack for the cash in equity, as they were nascent and perceived to be high risk.
- The interests of the entrepreneurs and investors were not always fully aligned.
The key to addressing these, for me, came in a range of conversations with folk outside the start-up community, folk who would love to share their knowledge and expertise to support ideas they believed in, but had no mechanism to do so.
They were not really looking for cash explicitly, but rather to “invest” some of their spare time in the exciting and exhilarating start-up world, with all the risk and reward that offered.
I felt revolutionising the way start-ups start up with this powerful, under-tapped resource, especially given the inherent alignment of the risk and reward it provided, would be worth exploring, and consequently did just that.
How did you know there was a market for it?
We spent a lot of time talking to hundreds of entrepreneurs, and even more prospective contributors, to assess the acceptance of the model and potential demand. Our findings gave us the confidence to make the commitment required to move forward and invest ourselves in the endeavour.
Interestingly enough, this is one of the key questions Vestd helps entrepreneurs with too. It helps validate business ideas, since a start-up will only get investment from Contributors if they believe in it – indeed, some Founders on Vestd have already tweaked their propositions based on feedback from Contributors
What were you doing before starting up?
Although I started my entrepreneurial adventure in my late teens, inspired by Sir John Harvey Jones, I went on to develop and hone the skills as an ‘intrapreneur’, within the global energy sector.
Whilst I thoroughly enjoyed, and learn a great deal from my years as an intrapreneur, the passion to be back in the start-up world myself remained strong.
For years, Naveed, my co-founder, and I would meet up on a regular basis to share and explore the many exciting transformative technologies and disruptive business models we were coming across in our respective arenas.
Eventually we decided to take the bold step and get involved more directly ourselves.
We started with Inaverve, a vehicle we had designed to invest in and support start-ups, in their very early stages.
Now, although I had started my entrepreneurial adventure many years ago, I had since spent most of my life within the corporate world, and while I could help financially and strategically those ideas I felt had merit, I was not fully attuned to some of the real challenges facing entrepreneurs today.
Being a “professional CEO” in a large corporate, is quite different to being a “founder CEO” in a start-up. So, alongside our investments in others, we determined to run the gauntlet ourselves, with one of the ideas we’d explored during our many conversations, namely Vestd.
What started as much as a learning exercises as a real business idea, soon had us convinced that we could help more great ideas and entrepreneurs through Vestd, than our limited individual financial or human capacity.
Have you always wanted to run your own business?
Simply put…yes. However, growing up with limited financial resources in Yorkshire, my first foray into this space, well before the days of easily accessed networks, incubators and accelerators, government support and Venture Capital (as we know it today), proved challenging.
So I thought I'd spend a few years building some cash and experience, then return……I guess I spent a little longer away than I had initially thought I would.
How did you raise the money?
We have used a three-pronged approach to funding Vestd:
The first is a demonstration of our own commitment, with circa 50% of the total investment from our own cash.
A further 25% using the Vestd model of contributors working in exchange for equity, for example our branding has been developed by BrandCap, a leading consultancy that believes in us, similarly our four strong Advisory Panel and others.
The remaining 25% has come from a handful of third party investors, who bought into the concept and business, once we had built the platform and secured our FCA authorisation.
Describe your business model and how you make money:
Whilst the is a small fee for start-ups to join the platform, which includes the cost of incorporation ( or linking if already incorporated), we look to secure our long term sustainability from the success of the start-ups we help to succeed, i.e. whenever some shares are issued to a contributor for their assistance, Vestd will receive a small proportion of the eventual monetary gain that the contributor receives when the shares they have earned are monetised.
In this way, the interests of everyone in the chain, from the business founder to Vestd, are all aligned to the success of the business.
There will be other services we will be able to offer to founders and contributors in due course, which will obviously provide additional value for them. Some of these will have associated fees and thereby further aid the sustainability of Vestd.
What challenges have you faced and how have you overcome them?
Many! The path to building any business is fraught with roadblocks of one kind or another….that to the equity economy is no different!
The most fundamental was challenging the established wisdom and mantra of “never give away your equity”, and helping founders appreciate the benefits of how judicious use of this precious commodity, which was significantly more powerful than cash, could result in amazing progress.
But without a doubt the biggest hurdle was the FCA authorisation. We had already invested a significant amount in the business when we realised that we would not be able to progress further without the authorisation, and structuring ourselves to be regulated.
It was a case of either having to write off our investment and forget the dream, or invest significantly more in time, effort and money to achieve regulation….and one step forward. It took a big leap of faith.
What was your first big breakthrough?
The FCA authorisation was a real breakthrough and a relief, as we were seeking authorisation for something innovative and that had not been contemplated when the rules were drawn up….so impossible for us to just “copy and paste” from other applications.
However, this should not overshadow the significant boost and thrill we got from finding the right partners and getting our first start-ups online….these brought real smiles to our faces!
It is amazing to see the inroads our start-ups have already made, having just been on Vestd for a few months.
Watching people like Gail Spooner, founder of mymakeupconcierge.com, the first business to have a task completed on Vestd, has been incredibly rewarding, seeing her idea transform into a real startup, with contributors becoming part of her team and helping her go from strength to strength.
What advice would you give to budding entrepreneurs?
Use Vestd of course!
If anyone is in two minds about starting a business, I say take the leap and go for it! Vestd makes the complicated and often intimidating process of incorporation simple, and significantly reduces the risk profile by sense checking the business, giving instant access to specialists and minimising the cashflow headache.
Allowing you to crystalise your idea without having to empty your bank account or chase cash before you are ready.
Where do you want to be in five years' time?
We want the equity economy to be part of common business vernacular and Vestd.com the obvious first place to go get your start-up started.
Vestd to be recognised as a positive disrupter, that allowed many great ideas come to life and grow, that would otherwise have been lost.
Start to realise our dream of allowing great ideas succeed irrespective of the geographic or financial starting point of its founder(s).