Adventures In Micro-Business: Websites, venture capital and tax breaks

Russell Smith answers your queries

Q. Could you suggest a good source of information about management please?

Q. Could you suggest a good source of information about management please?

A. Take a look at the "Achieving Best Practice in Business" section of the DTI website ( www.dti.gov.uk/bestpractice/people/people.htm). There is a good range of material from the introductory to the inspirational.

Q. I am thinking about starting a business that will offer cost-effective web design services. The main challenge will be in reaching new businesses. I don't have the funds needed for a big advertising campaign. And, of course, searching with Google only gives me businesses that already have a website!

A. I suggest that you start with limited companies (since most will need a website) and Companies House may have just the product that you need: a DVD-Rom directory that gives details of over 1.8 million companies. The DVD has a facility that will allow you to search for new companies. And you can also search by location which will allow you to target companies local to you. A new DVD is issued every month and costs £30. For further information about the DVD-Rom or to buy a copy send an e-mail to products@companieshouse.gov.uk or call 029 2038 0820.

Q. Where can I find out more about venture capital? I've not been able to secure a bank loan for my small business and am thinking about trying to attract an investor.

A. For anything less than £100,000 it's unlikely that you will be of interest to the larger venture capital companies. Nevertheless, the British Venture Capital website ( www.bvca.co.uk) is a good source of useful information. Most investment into small business comes via "business angels"; wealthy individuals who generally invest up to £100,000. But the trick is in knowing how to find them. I would start with Business Link ( www.businesslink.gov.uk) and speak to your local adviser. It is more than likely that there will be a "network" of business angels near you and your Business Link adviser should be able to make an introduction for you. Sometimes these networks are run along the lines of a club and you could find yourself addressing a small group in a private room at a pub. Other networks operate on a professional footing and the organiser may take a percentage of whatever money you raise from the group. Expect to pay a commission of around 5 per cent.

Q. I've heard that there are tax benefits available that support the development of technical ideas. Would my small company be eligible?

A. If you are referring to the Research and Development (R&D) Tax Credits, small companies can in certain circumstances claim payable tax credits in cash from the Inland Revenue. To learn more, go to the HM Revenue and Customs website ( www.hmrc.gov.uk/randd/) but this is something you should discuss in detail with your accountant.

QUESTIONS PLEASE

Send your questions to Prof Russell Smith at ios@businessboffins.com. Selected questions will be answered each month. Answers are for the general guidance of owner-managers only; always seek professional advice.

Professor Smith is the founder of Oxford-
based Business Boffins Ltd which, in collaboration with Oxford Brookes University Business School, delivers sustainability support programmes
to small businesses nationwide. Independent On Sunday readers
can enrol on the university-accredited programme at a discounted rate;
see www.businessboffins.com/ios