Block: Sam Smith fears women will be excluded
The Government may row back on changes to rules promoting start-ups after critics warned they could lock out female ‘angel’ investors.
Bim Afolami, the City minister, this week said the Government had noted the ‘significant concerns’.
Angel investors plough money into start-up businesses.
Under the current rules, businesses need approval from City regulators before they can market themselves to investors.
But promotions targeting High Net Worth individuals – which would include most angels – are exempt.
A row has erupted over moves from January 31 that raise the High Net Worth threshold to £170,000 a year – from £100,000 previously – because only 72,500 women in the UK make that much. It has led to fears women will be excluded.
Sam Smith, founder and former boss of broker FinnCap, said: ‘This change is putting blockers where they don’t need to be.
‘People from under-represented backgrounds tend to back businesses founded by other people from under-represented backgrounds.’
Emma Sinclair, founder of digital marketplace EnterpriseAlumni, added: ‘Fewer females being able to invest in female founders is catastrophic and paternalistic.’