You’ve got that great start-up idea, but don’t know how to get it off the ground? This is an issue most face when making those daunting first steps as an entrepreneur. You’ve written your business plan and you’ve had an accountant check it over and verify your cashflow forecasts for the first couple of years, but now you need to fund it. Here are some ideas that can help you get started:
- Personal savings or re-mortgage of personal property – Clearly this is the cheapest option available as residential mortgage rates are very competitive and may be tax deductible
- Business Grants – Grants tend to be sector specific, so your trade body or association are a good place to make enquiries. The Government website has a business finance and support finder at https://www.gov.uk/business-finance-support-finder. Technology, arts, green tend to be the sectors that attract have most grant options available to them.
- StartUp Loans – This is a government scheme to provide loans for up to £25k to entrepreneurs that want to start a business. There are various other benefits too such as free mentoring and extensive support through workshops and events. Loans and services are provided through not for profit “delivery partners”. We would recommend Startup Direct, who are based in London and Birmingham
- Business Angels – These are people who tend to fund businesses in sectors they have experience in and therefore can add stacks of value to your business if you choose carefully and you hit it off. They are likely to want to have a say in how your business is run which you may or may not want. If not, and your business fits the profile, you may want to consider equity crowd funding.
- Crowd Funding – Complete a questionnaire specifying how much is to be raised and the equity on offer. There is then a period where investors can invest as much as they want up to the amount requested. A fee of approximately 5% is charged when successful. Our recommended platforms are Crowdcube (www.crowdcube .com) and Seedrs (www.seedrs.com). Both are FCA regulated, however most are not.
If you are considering raising business financing, Square Mile Accounting can help you navigate the funding process, give the team a call today on 0203 282 7109