
Working with you, we will explore the finance options that are right for you, and the package we put together for you may include a variety of funding sources.
We can help you to present your proposal for funding in the most effective way, with all the relevant information to hand, to help you achieve the finance you need on the best available terms. Finance options include:
Asset finance
There are likely to be times in your business life when you need
to buy assets, such as equipment for a particular job or new furniture
for new staff or to smarten up your office as a visual reminder
to clients of the professional way you do business.
But you may also be reluctant to dip into your capital that you need for further expansion. Asset finance options, including hire purchase and leasing agreements, can provide a cost-effective solution, allowing you to re-equip without using up your cash reserves.
Cash flow lends
Sometimes if there is insufficient security for borrowings but your business
can demonstrate a good track record in generating cash then funding may be available
against the cash flow. An example might be where you have spent a lot of money
in the past on fixed assets. Your business might have a big depreciation charge
but because it is not a cash flow cost your business might now be generating
really strong cash flows. A number of lenders like this and we can help present
it to them.
Bank overdrafts and loans
Bank overdrafts and loans are the most common sources of external finances available
to businesses. Used properly, they provide a simple and effective way of financing
the growth of your business.
For example, a bank overdraft can be a useful tool to cover short-term finance needs, perhaps for stocking up on an item that’s only available for a limited period at a highly competitive price. If you need the cash for a longer period, a fixed term will give you certainty of funding, provided that you keep up the monthly or quarterly repayments.
Business angels/venture capitalists
Business angels can be a useful source of capital for new businesses
and those with potential high growth. They are wealthy individuals
who operate alone or in syndicates. A typical investment for an
individual would be £25,000-£100,000
while syndicates may invest up £500,000 or more.
Venture capital firms normally seek to invest very substantial sums, which can open the door to other funding, such as bank loans, but there will usually be conditions attached, such as a seat on your board of directors.
Enterprise Investment Scheme
The Enterprise Investment Scheme, or EIS, is a government initiative
designed to encourage private individuals to invest in the UK’s private companies.
Investors qualify for a range of attractive tax benefits to reflect the inherent investment risks, with successful EIS companies offering the potential for strong growth and superior returns.
Invoice discounting and factoring
Invoice
discounting is a common finance arrangement with a finance company or bank.
The bank or finance company will advance money to a business against its invoices – usually80
or 90 per cent of the value – to improve cash flow, while the business
continues to manage its own debtors.
Factoring is a similar arrangement but the bank or finance company will also manage the business’s debtors, providing a collections service to chase unpaid invoices.
Small Firms Loan Guarantee
Sometimes you may need funding for a viable business plan but cannot
obtain a conventional loan because you have no assets to offer
as security. The Small Firms Loan Guarantee (SFLG) helps to overcome
this problem, by providing lenders with a government guarantee
against default in certain circumstances.
The SFLG is a joint venture between the Department for Business, Enterprise and Regulatory Reform and a number of lenders. Key features include:
If you wish to know more about our corporate finance service or would like to arrange a free initial meeting in order to discuss how we can help you in more detail please contact us.
0121
355 1901
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