Finance

Commercial Finance for SMEs & Accountants

Scale Up I Advisory I Finance

We are an independent Commercial Finance Brokerage with direct access to 27 lenders alongside 120 more for when they are not quite right. This means business owners can be confident that we have the widest choice available to meet your individual needs.  We have experience of underwriting and therefore we understand how to source the right lender for you.

We realise every business is different, therefore we work with you to understand your business’s needs before presenting you with your Finance options or consolidation of existing arrangements.

Growth Accelerator enables SMEs the opportunity to manage their cash flow in order to maximise financial performance. It is designed to help SMEs to get the most out of their cash flow and to effectively grow the business. To manage your finances effectively we offer Growth Accelerator to work with you and your existing Accountants and inhouse team to set effective financial KPIs that match your business goals and align with competitors in your industry. We will provide monthly support and guidance for your Board Meetings as Adviser and become an extension of your company’s financial management.

Business Advice - The Business Strategist

Call or virtual meeting

Business Owners book a call to discuss your financial requirements whether it is for new funding, consolidating existing borrowings or reducing the cost of existing arrangements. Whatever you do will have a substantial impact on your financial well being and sustainability. I will help you to ensure you have considered your options and help you with the best way forward. 

Any Day

I have set aside time to assist business owners to secure the most appropriate funding based on your individual circumstances and I will source solutions from a number of financial providers. There are now many complex options and providers for SMEs to consider, I will ensure we cut through the jargon and help you to understand your options.

Any Finance related questions

Ask me about how to solve your financial requirements and benefit from our expertise and knowhow. We will provide you with an independent view to help you consider what will work for you without wasting valuable time and money.

Get an unbiased view

You may already have people who advise you on financial matters, however I am offering you a second opinion before you commit yourself for the long term.  I will offer you an unbiased view to enable you to make an informed decision about the financing of your business.

You will never receive any communication from me after the meeting unless you ask me to.  All advice given is without obligation and completely confidential.

Book a strategy call today

Raising Finance

Overview

Funding or finance is just borrowing money for someone else for a purpose. The financial services industry likes to give it names to help themselves as much help you the business owner.

Below we take a look at the different types of funding and when you would use them. How you use them is as important as why you would use them. Money without a plan is wasted. Funding is offered either as unsecured or secured.

Unsecured funding

An unsecured facility is one where no physical security is provided. For example, a loan could be offered to you as long as you provide a Personal Guarantee. As you are not providing something tangible such as property or machinery, the facility would be unsecured. Requiring a PG is the most often requested commitment for SME funding, with this being the case since c2008 and the uprising alternative funders to the High Street banks.

In some cases, mostly under the UK Government’s Coronavirus Business Interruption support, facilities have been offered with no security and no personal guarantees, making it truly unsecured.

Secured funding

Secured funding is when your company (or you if you’re a sole trader) grant security over something you or your business owns. The most obvious example is the mortgage. You give the funder the right to repossess the property if you don’t meet the terms of your agreement.

Other examples of secured facilities are Invoice Discounting (you sell the invoices to the funder) and Asset Finance where the funder buys the machine on your behalf and rents it to you for a period of time before you become the owner (or give it back).

Short term loans are typically unsecured (other than via a Personal Guarantee) and based on your ability to repay the borrowing over a 12 month period. Funders will determine your affordability looking at a combination of your bank statements and financial statements.

The funder is looking for sufficient cash availability in your bank statements when adding in their repayment which could be daily, weekly, or monthly. A review of your financial statements further supports your ability to repay the loan if your business is profitable before other interest costs and tax.

You would want to use this type of loan when the payback period is short. For example, if you wanted to buy stock at a cheap price and sell it quickly this product would work (an Overdraft or Revolving Credit Facility would be better). A another example would be to repay HMRC, giving you more time to pay and spread it over a year.

Medium or long term loans range between 3-7 years depending on the size of borrowing and lender. 5 years is the one of the more popular lengths.

For this type of loan, the funder will be using your financial statements, strength of your personal guarantee (if unsecured), and credit score of your business to make sure the company will be around for the length of the loan. It is much harder for funders to be certain businesses will be around for 3+ years unless you are a more established business and have a solid foundation.

This loan can be unsecured or secured, with some funders offering part secured, part unsecured.

Why would you use this type of financing?

You would want to use a longer term loan when the returns are likely to take longer to happen. For example, hiring new sales people doesn’t always create results overnight, and so giving yourself time to train them and build their own pipeline before having to pay them in full from your own resources helps don’t you think?

The other great example of this is buying another business. This gives you the capital on day 1 and the ability to make repayments over the longer term when the growth you’ve bought comes to fruition

A great product for accessing cash tied up in invoices raised to your business customers. Invoice discounting enables you to get paid straight away rather than waiting for the elongated payment terms of your large customers or the promises to pay by your smaller clients who themselves might be waiting for a customer to pay them.

Why would you use this type of financing?

We see customers use this for many reasons, as it’s a popular working capital option. This facility works extremely well where you need to pay for materials on a job before your customer pays you so our engineering and manufacturing clients love this as an efficient way to keep up with supplier payments.

A merchant cash advance is the closest equivalent of invoice financing in the retail and hospitality markets where a large part of your payments are taken by credit card, online through services like Shopify.

The funder will provide cash to you and take repayments as a proportion of you card/online takings, giving you a repayment profile that matches your cash flow. If takings are lower than normal, the amount you repay overall doesn’t increase as it’s a fixed repayment amount agreed upfront.

Why would you use this type of funding?

A merchant cash advance has a flexible repayments and is used for many reasons by our clients ranging from stock purchasing, to cash flow, and refurbishments. The choice is yours which is what makes it so great! The fact is tied to your card/online takings means there is no need to worry about making repayments as its taken at source, so no additional repayments required by you!

Overdrafts (or Revolving Credit Facilities to give them there other name) are something you may already be familiar with in your personal finances as there if you need it, the safety net to your finances. They can also be provided for businesses and work on the very same basis, borrow what you need, pay it back when you can and only pay interest on the amount you borrow.

 

Why use this type of finance?

Its flexible and inexpensive for use in short bursts. A great way to avoid costly bank charges

As its name suggests, this finance is used for purchasing assets within your business. These assets that can be financed have grown over time, you can now finance, plant and machinery, computer equipment, printers, lighting, software, contracts. Pretty much anything you would normally make a capital outlay for.

Why use this type of finance?

Asset finance can be very tax efficient as purchases can be offset against taxable profits, and because the finance is secured against the asset it can be inexpensive too. Some of our clients have significantly increased profits by buying machinery or vehicles so they no longer have to hire in vehicles or subcontract work.

Bridging Finance is the short term property equivalent of a loan. They are typically 12 months in length (although can go up to 36 months) enabling you to purchase a property quickly at auction or where a chain break is needed, or alternatively works are required on the property that are something more than a lick of paint.

Bridging finance can be completed in less than a month, and in most cases doesn’t require any payments whilst its outstanding as the interest is retained giving you the confidence and time to do the renovation work or get a tenant in situ.

Why use Bridging Finance?

Bridging finance has its roots in auction purchasing where the purchaser needs to complete quickly. Its now used for many more things such as beating the end of Stamp Land Duty tax holidays, to refurbish buy to let properties and whilst you are waiting for the longer term mortgage to be approved.

Bridging finance can be used for both residential and commercial property at varying LTVs.

As its name suggests, a Buy to Let Mortgage is a property mortgage used for your investment residential properties. They can be secured against one or more properties, with the rental income of the properties used to repay the funding.

Typically Buy to Let Mortgages are interest only, so you will need to make arrangements to repay the capital at the end of the process.

A Commercial Mortgage can be used either for you to purchase the building you operate from or as an investment. The difference between a Commercial and Residential or Buy to Let mortgage is lower loan to values and higher interest costs to reflect the longer sale times of this type of property.

Many businesses like to own their own property and this gives you the option. Its not usual to see Commercial Property in a pension fund and rented to the beneficiaries company (please take the necessary advice).

Growth Accelerator

Growth Accelerator enables SMEs the opportunity to manage their cash flow in order to maximise financial performance. It is designed to help SMEs to get the most out of their cash flow and to effectively grow the business.

We will work with you and your existing Accountants and inhouse team to set effective financial KPIs that match your business goals and align with competitors in your industry. This will create greater value for your business at disposal, accelerate your growth and profitability.
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We will provide monthly support and guidance in your Board Meetings and become an extension of your company’s financial management.

Benefits of being a Partner

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SMEs

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Insights

Times change so do your financing needs

2018 was a year that saw the High St ravaged, with numerous retailers closing for good and large-scale closures. As someone who grew up in the heyday of Toys R Us, scoffed at the likes of Poundworld and the trickery I’d learnt they traded within and been concerned about New Look since the early 2010’s I wasn’t surprised but saddened nonetheless as thousands of hard-working employees lost their jobs through no fault of their own.

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SME Finance – The inhibitor you can solve

The UK is renown for its startup and fintech scenes. It’s also home to some of the worlds largest financial institutions ensuring obtaining is funding a simple process, right? Not so, survey after survey highlights the lack of funding available to SMEs and how it’s the number 1 challenge followed by access to good talent.

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