One of the attractions of a business grant is obvious: unlike a loan, the money does not normally have to be repaid. If I have a good business idea but very little money of my own, finding a grant can therefore seem like the perfect solution. Unfortunately, having no money to invest can actually make…
Equipment can be one of the largest costs involved in starting or expanding a business. Depending on what I do, I might need machinery, tools, computers, manufacturing equipment, specialist technology or equipment that allows me to increase production. Business grants can sometimes contribute towards these costs. In fact, equipment is one of the areas where…
Starting a business from home can dramatically reduce the amount of money I need. I may avoid commercial rent, business rates on separate premises and the cost of fitting out an office or shop. Even so, I could still need equipment, stock, software, insurance, marketing or specialist adaptations before I can begin trading. Business grants…
Being self-employed does not mean I am excluded from business grants. Sole traders can qualify for many business-support programmes, although the rules vary considerably from one scheme to another. Some grants accept sole traders, partnerships and limited companies. Others are restricted to incorporated businesses or organisations meeting specific conditions. I would therefore never assume that…
When I start looking for business grants, it is tempting to concentrate on large national government programmes. However, some of the most relevant opportunities for an ordinary small business can be much closer to home. Local authorities, regional organisations and economic development programmes can all provide funding and business support. The difficulty is that local…
A poor credit history can make borrowing more difficult, but it does not necessarily make a business loan impossible. Different lenders assess risk in different ways, and the importance of my personal credit history can depend on my business structure, how long I have been trading, the amount I want to borrow and what security…
A personal guarantee can make business borrowing feel much less separate from my personal finances. I may operate through a limited company, but if I personally guarantee its loan, I can become responsible for repaying the guaranteed amount if the company cannot. It is therefore reasonable to ask whether I can obtain business finance without…
A new business often needs money at exactly the point when borrowing is most difficult. I might need equipment, stock, marketing or working capital before the business has had enough time to build substantial revenue. Traditional lenders often like to see evidence of trading performance, which a brand-new business simply cannot provide. That does not…
Being rejected for business finance by my bank does not necessarily mean that the business cannot obtain funding anywhere else. Banks have their own lending criteria and risk appetite. A business that does not fit one lender’s requirements may be acceptable to another provider using a different approach. In fact, the UK has a specific…
Raising investment can provide a business with substantial amounts of money, but equity finance comes with an important trade-off. I sell part of the business in exchange for the investment. For some entrepreneurs that makes perfect sense. For others, retaining ownership is a priority. Fortunately, equity investment is only one way to finance a business….