The first-round funding was provided by venture capital firm Summit Group and Commer Investment Fund, which is run by entrepreneur Jim Walsh. Up until now, the firm's directors have provided their own funding.
Screen Network was set up in October 2001 and supplies, programmes, installs and manages large plasma television screens and provides the content for them. The screens provide shoppers with local and national advertising, features, news, traffic and other information. They allow retailers in the centres, as well as other local and national advertisers, to reach potential customers close to the point of sale.
The business has trialled its screens in the White Rose shopping centre in Leeds and the cash injection will allow it to meet demand from other centres around the UK. Kit Hunter Gordon, managing director of the Summit Group, says the firm is in active discussions with a number of centres at present but cannot name them until formal agreements have been reached. Screen Network also has international ambitions but Hunter Gordon says the firm will 'avoid running before it can walk' and focus on the UK for the foreseeable future.
The firm was set up to exploit technology that has been around for about four years. Managing director John Harrison was a pioneer of early versions of the technology, having spent most of his career in advertising-related businesses including digital media. Harrison says the firm struggled to find appropriate funding: "It is very difficult to find development capital of less than £1m that is not either bank debt or from investors who want a day-to-day management role," he says.
Hunter Gordon, whose fund makes seed and early-stage investments of between £250,000 and £500,000, agrees that there is an equity gap for firms like his to exploit. "Because of fees and due diligence, it is simply not economical for most venture capital fund managers to invest less than £1m," he says. "It takes a special breed of investor to invest close to £1m, because for business angels it's probably too much. These days, it's a lot easier to raise £10m to £50m."