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Great post! Lots of interesting points, but I disagree with:

"You need to pick a large market if you want to raise venture capital investment. A business that makes £10m profit per year may look great to you, but it's small fry for a VC."

If one is making 10MM a profit a year, the company is clearly worth >= 10X the amount. I am no VC, but I would assume most VCs would be drooling over investing in such a company.

I was especially interested in this comment given the OP's choice of target market. Is the UK secondary market big enough... do you think you can take the business off the auction houses? My understanding of them is that a big part of their service, and why they might be able to justify larger fees, is the cellar valuation, all-in-one service e.g. for clearing out a dead relative's estate.

I definitely think there's something in the individual's secondary market and the competition that exists, e.g. B4W and also the online forums, prove this. It would also be nice to arrange selling of smaller quantities than cases. Just wasn't sure if that would reach the numbers in the OP's point.

There are quite a few large players in the market and many middle men between the producer and consumer. The secondary market is very inefficient - the default is to sell to a traditional merchant who will take 10-25% of the price. Auction houses take around 25% and prefer volume to single cases.

This gives us several angles to attack. Market size was a concern when talking to investors - and we took money from people who would be happy with that kind of scale.

It's a matter of whether the company can make that into a billion within a few years, and most companies who get to 10 million yearly won't ever get there either due to a business model that doesn't allow that kind of scalability or a market than can't grow that much. So I'd think VCs wouldn't be that interested if such was the case.

Kind of agree with this - traditional VCs are only likely to be interested in the billion dollar/pound companies.

Many angels and small funds will be happy with £10m/year - it's just a case of picking the right type of investor for your company.

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