Netcplus Internet Software Limited, a tiny but innovative UK software start up, has hit out at the antiquated banking system in the UK, which it claims is failing to support Britain’s IT entrepreneurs. The lack of understanding and willingness to share risks amongst the high street banks is driving businesses out of the UK, it claims. Netcplus, which was named by Computing Magazine as one of the UK’s top 20 start ups, has developed a software package which allows small businesses to run an email server on an existing PC for just a few hundred pounds. Small companies in Europe are desperate for email capability, say Netcplus’ founder Ian Turner, but they balk at the hardware costs and support fees associated with a traditional email server running, say, Windows NT; let alone the cost of a Unix server. Having developed and brought its Smart Server product to market, initial interest in the software has been enormous. Now, Netcplus is trying to raise just 150,000 pounds to run a proper marketing campaign, but none of the UK’s high street banks wants to know. In fact they’re going out of their way to be positively difficult, says Turner. He has approached all of the high street banks to try for funds under the government’s Small Business Grants scheme. But even though the government guarantees the majority of the loan, leaving the banks with minimal risk, they are still insisting on cast iron guarantees and large forward orders. The kind of conditions that small software start-ups simply can’t fulfill. If they (the banks) are not supporting a business sector widely recognized as crucial to the UK economy – what are they achieving with government funds? says Turner. I’m not sure where the log jam is – but someone had better clear it soon. Are we just going to roll over and hand it all to Microsoft? he said. Turner and his co-founder have already handed over 45% of the company’s equity to venture capitalists just to raise 180,000 pounds. Not easy to bear when the founders have themselves poured three times this and more into the business over the last four years. We have a product, we have re-sellers clamoring for it, and we have concrete sales, says Turner, but the banks just won’t play ball. They want your belt, they want your braces, they want your balls on the chopping block, and all for just a tiny amount of risk, said Turner. The company is now being forced into negotiation with foreign investors. Not a good sign for the UK’s undoubted excellence in software development. We’re being turned into a nation of Burger King employees, complained Turner.
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