Red Flag Alert eyes strategic growth as Foresight invests £3.5m
Business intelligence specialist Red Flag Alert has received £3.5m growth capital investment from venture capital investor Foresight in return for a 20% stake in the business.
Chief executive Richard West told TheBusinessDesk.com that the investment will enable him and his team to make more strategic decisions and develop a three year plan.
“This investment will enable the organisation to focus on growing the business and staying true to our values and our objectives,” he said.
“It’s really important that we stay agile and innovative.”
He added: “In the fast-paced world of financial risk and data insights, innovation and disruption are vital. From the beginning of our conversations with Foresight, they understood Red Flag Alert’s mission and our value in the industry.
“We are proud to work alongside them to grow our market share and continue our journey.”
He said the 50 plus people based in the central Manchester “Data HQ” would be the foundation of the business and its future product development. “Everything we want to achieve we can by build a leading business data company here in Manchester, it’s northshoring.”
Red Flag Alert has developed a proprietary SaaS business intelligence platform with modular capabilities spanning credit security compliance, sales prospecting, risk management and financial health assessments sold to businesses.
West said the success to date has been founded on the excellent service levels it provides, with continual investment in its product to deliver new functionality for customers.
Foresight’s investment will be provided through Foresight VCT and Foresight Enterprise VCT and will support the growth ambitions by investing in product development, and creating high-quality, sustainable jobs and to expand its commercial capabilities and reach.
TheBusinessDesk.com understands that a further £1m in venture capital investment into the business has also been provided by another investor.
John Lord will join the board as Non-Executive Chair, replacing major investor Ric Traynor, founder and chairman of Begbies Traynor, who is still a major investor and will remain on the board.
Lord was Group Managing Director of listed data provider GB Group for eight years and spent six years as Managing Director of Dun & Bradstreet UK. He also founded a leading customer onboarding platform which he exited to LexisNexis.
His expertise will help the Company grow and significantly increase its market share.
Fiona Hatch
Fiona Hatch, Senior Investment Manager at Foresight, who has also joined the board, said: “Red Flag Alert has built an impressive product and customer base. With our investment and support, the team will be in a great position to benefit from the potential market opportunities. We look forward to working with Richard and the rest of the team to enable the next phase of their growth.”
Foresight completed more than 90 investments into SMEs in 2022, alongside a number of exits. In the same year, Foresight’s Private Equity team announced three new funds, a ventures fund acquisition and expanded its regional office network, opening offices in Dublin and Leeds.
So far in 2023, Foresight has invested into 35 SMEs, announced it will open an office in Newcastle, and has announced a number of successful exits, including Datapath (11.7x money), Mowgli (3.5x money) and GovGrant (4.5x money).
Corporate Finance Advisers to Red Flag Alert were Will Stanton and Paul Cheetham at Sedulo, legal advisers were Brabners.
Foresight were advised by Hentons Corporate Finance (DD), RW Blears (legal), Calaysis (management DD), Cloud Origin (Technical DD), Locktons (Insurance DD), KryptoKloud (cyber DD), Whitecap (Commercial DD).
