Channel 4 is investing millions of pounds of media value into supporting entrepreneurs who have traditionally been overlooked by the venture capital ecosystem.
The new ‘Untapped’ initiative is an ‘airtime-for-equity’ scheme, which gives startups the chance to advertise on TV for the first time in exchange for a minority stake in the business.
Led by Channel 4’s consumer investment arm Channel 4 Ventures, it will see the broadcaster invest in a number of high-growth businesses led by founders with a broader range of profiles across gender, education, socio-economic diversity and race.
The move will also help generate new revenues for Channel 4, which announced job cuts at the beginning of the year in response to the sharp decline in TV advertising spend over the past year.
Based on a new framework that helps the broadcaster identify more potential investment opportunities in new businesses, Untapped will also help grow Channel 4 Ventures’ profile by supporting its ‘fast forward’ strategy to ramp up new and diversified sources of revenue as part of its move to become a digital-first streamer.
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Channel 4 Ventures head Vinay Solanki said: “Untapped will enable Channel 4 to invest in and incubate high-growth businesses, delivering significant commercial returns to drive forward Channel 4’s distinctive remit.”
“The data implies that a wide range of talented founders leading attractive commercial organisations are being overlooked by the current ecosystem and we are committed to identifying and backing them.”
“More broadly, Untapped can be a catalyst to grow the UK consumer investment landscape and encourage others to follow in the investment space.”
Particular focus will be given to women founders, those not educated in the same prestigious set of institutions, companies from across the UK, people from ethnically diverse backgrounds and people from outside the traditional start-up ecosystem.
It follows on from research which looked at publicly available data on LinkedIn and Pitchbook and found that 94% of founders were men, despite the fact that men only represented 41% of all UK graduates. It also revealed that new business founders were 51 times more likely to have graduated from Oxbridge or a similar university outside the top 100 institutions globally.
It also found that consumer companies in London, Oxford or Cambridge are 11 times more likely to have raised a valuation of £100m + than a company located elsewhere in the UK. Moreover, 67% of founders were either previous founders or came from within the traditional start-up/investor ecosystem.
