huggg is an app that aims to spread a bit of love by letting you send food and drink to friends, whenever you fancy treating them. Since being founded in 2016 they’ve gone from strength to strength – employing 14 staff and raising successful round in January 2018 led by Kindred Capital. We spoke to huggg founder Paul Wickers on their experience with accessing financing.
What are the biggest challenges you've faced as a company looking to raise money in the UK? Have you been able to find the knowledge and connections locally to help you in your journey?
Knowing where to start when you have no network is the single biggest challenge when looking to raise money. The second is, the vast majority of those who have money to invest are so inundated that they're impossible to get in front of unless you've got an intro. It can be quite difficult to get it moving, but once you have or make connections, it becomes a lot easier.
I was lucky enough to be able to rely on my personal networks, but there are tons of amazing meetups and materials in the region to help founders get started. Resources like South West Founders, Threads South West and the Scale-up briefings run by the Engine Shed, are all great for new founders trying to access networks and learn what to do next.
What advice would you give yourself if you went back in time a few years?
Spend more time finding a minimally viable way of validating ideas and projections rather than jumping straight to building out a potential product and solution. We got lucky that we managed to do it - but it was luck, and I wouldn't advise approaching it that way. The best part about this advice? Validating ideas is almost always free to do when you know how and the cluster is full of people who are ready to teach you. I’ve heard that incubators and accelerators like SETsquared and the Natwest Entrepreneur Accelerator are just a couple that can offer support and they’re right on the doorstep.
How important has been able to raise the right amount of funding been to huggg?
Completely fundamental in taking us to the next level because we've needed people and people require capital because the expenditure precedes revenues.
Going forward, in order to raise the right money, we'll use our existing investor base as the cornerstone for the next investment and also for the source of intros for the next round. We will be looking to raise in 2019 and looking to raise our revenues as well.
What tools/people/services would you recommend to others locally as they look to scale?
There are those that I’ve mentioned already, amongst others. For me though, scale is all about having a relentless focus on the product and solving the most pressing problems at each stage. So, the best thing to do is just hire great people. You can only succeed by having better people than your competition (if you have competition, that is!)