Hi, I’m Andrew McKenna and I’m an Access to Finance Advisor for the Sheffield City Region (SCR) Growth Hub, which aims to help businesses across the region access the best business support for growth.
I’ve worked for the Growth Hub for over three years and prior to this I was a banker for 26 years.
Research shows that there are over 300 business finance lenders and 23,000 business finance products in the UK. Gone are the days when SMEs are raising finance automatically, regarded the bank as their first – and often only – port of call.
The development of alternative finance has given growing businesses access to a much broader range of funding options, beyond a loan or overdraft to help fund their cashflow. For example, funding options now include: Invoice Finance, Stock Finance, Trade Finance, Peer to Peer Lending, Merchant Cash Advance, Crowdfunding and many more besides.
The range of funders is equally bewildering, the High Street banks are still funding, but there are a plethora of alternatives including challenger banks, peer to peer platforms such as Funding Circle, asset backed lenders, equity funds, government grants and British Business Bank backed loan and equity funds such as the Northern Powerhouse Investment Fund.
The market is also now seeing some of the huge technology firms such as Google, Amazon, Facebook and Apple (GAFA) enter the business finance fray using the knowledge they can pick up on how a business operates from their platforms.
So how does an SME navigate this world when they need money to grow their business or fund their day to day cashflow?
- Make sure you have the right information that a funder will need, including up to date accounts and business plans. Your accountant or professional advisors can support you in this area, the more comprehensive your information the more likely you are to get the right answer the first time.
- Talk to your bank – nearly always the first port of call for anyone looking for financing options, and often the cheapest, although not always the best. However, if your request is declined by your bank they are obliged to offer you a referral to a number of funding platforms that may be able to help you.
- Talk to a broker – they are usually very well connected and understand very quickly what the right type of funding option might be for your business and who might have the appetite to fund you.
- Use the internet – there are a number of funding platforms available that after you have uploaded the minimum of information can come up with a range of potential options.
The Growth Hub’s Specialist Access to Finance Advisors like me are also on hand to help businesses across the region with the support and advice they need. This can be a minefield to try to navigate, but you are not alone and can get help when you need it.
If you want to find out more then why not speak to one of our Gateway Advisors here at the Growth Hub. Call us on 03330 00 00 39 or visit www.scrgrowthhub.co.uk for more details.