Despite seemingly crowded market places, some open thinking can unlock valuable niches for entrepreneurs.
Two firms have recently spotted opportunities in markets dominated by big players and have made moves to raise the cash to exploit their vision.
First is Poundland millionaire Steve Smith.
Smith was one of the founders of the firm. He sold his stake for £50 million in 2002, but the firm has grown and is now stock market listed with a value of £750 million.
His latest project is EstatesDirect.com, reports specialist start-up business investment information site SEIS.co.uk.
The online estate agent offers to sell homes for a fixed fee and has already notched 450 sales.
Crowdfunders back idea
Smith took his idea to crowdfunders and collected £500,000 from more than 190 backers for a 10% equity share in the business, valuing EstatesDirect.com at £5 million.
“The cash will fund a national roll-out of EstatesDirect.com. I want the business to become the UK’s largest personal estate agency network,” Smith said to SEIS.co.uk.
“The market is huge but is dominated by high street agents charging exorbitant fees. I want to bridge the gap between online and the high street to make the process easier and cheaper for sellers.”
Meanwhile, SEIS.co.uk also reports another niche start-up has raised £12.6m for developing technology for smartphones that lets small businesses collect debit and credit card payments without joining bank networks.
SumUp offers businesses a free card reader that plugs into a smartphone headphone jack and an app that turns the phone into a till for accepting card payments anywhere the user can pick up a phone signal.
Smartphone technology for traders
The company takes a 2.75% charge for every transaction passing through the SumUp system, says SEIS.co.uk.
The app and reader have already undergone a four-month trial across Britain, Ireland, Germany and Austria.
The company reckons that around 1.5 million small businesses will take up the idea.
Chief executive Daniel Klein told SEIS.co.uk: “Small traders have told us the app and service plugs a hole in the market for small businesses who find dealing with card services with banks too expensive.
“Smartphone use is gaining across Europe, and our market will grow with it. We already employ more than 100 people and this new funding will let us expand the business into new areas during the coming months.”
