Funding for business startup to scaleup – what’s available in the UK?
There is a myriad of business funding options and yet too frequently no available practical solution when you really need one. This article looks at funding for business startup to scaleup and points you in the direction of some solutions.
You can find out more about loans to start a business and funding to support innovation, such as Innovate UK and Horizon 2020 grants, at The London Group on February 28th.
It’s a widely held view that if you want to start a business the fastest and probably easiest way to raise investment is by tapping into the three Fs ‘friends, family and fools’. In other words your options for getting funding for business startup are very limited, however there are one or two other possibilities that it’s worth exploring.
Types of Funding for Business
If you need an overview of the wide range of different types of business funding you can find a summary of most of them and which are appropriate at different times; plus answers to questions such as – What is equity in business? Or – What is the difference between equity and debt investment? – at Pegasus Funding Resources.
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There is a government scheme that provides loans to startup business owners, backed by £310 million in UK government funding. The funding for successful applicants is provided as an unsecured loan. Tony Ryan will explain how these and other sources of funding work at The London Group event on 28th February 2018 or find out more here.
Incubators and Accelerators
The number of incubators and accelerators and range of services offered by them is steadily growing. They are definitely worth investigating if you are at the startup or early stage in growing your business. So check whether there is a local business incubator or business accelerator that might be able to help you get your business off the ground – read more about business incubators and accelerators here.
Crowdfunding has been much publicised as a means of raising business investment at an early stage in business growth, as well as to help with scaleups. It can work wonderfully for some businesses but many businesses fail to meet their targets and it requires a significant amount of effort and skill to be successful. Before you start you need to put some time into understanding the different types of crowdfunding platform and investment options, which range from equity funding and debt/loan finance to outright donations – read more on crowdfunding here.
Grant Funding for Innovation
There are UK Government and European grants that innovative and pioneering businesses can sometimes tap into, such as Innovate UK and Horizon 2020. Find out more about these two sources of grant funding at The London Group event on 28th February 2018.
Funding Innovation Using R&D Tax Credits
The UK Government provides funding to innovative UK companies under their Research and Development (R&D) tax credit schemes. This is a relatively easy source of extra finance to secure if you fit the criteria. You claim it through your annual corporation tax return, so it’s not advance funding, you have to spend the money in order to claim the benefit. Companies can get back up to 33% of what they spend on innovation – read more on R&D tax credits here.
Trade and Export Finance
If you are a growing company with export orders, or seeking to export abroad you may be able to get financial and other support from the UK Government’s UK Export Finance scheme, which is increasingly targeting its service at smaller business through partnering with banks. They aim to help businesses access enough working capital to expand into new territories and take on larger orders.
I’ve covered just some of the business funding options and ways of funding a business from startup to scaleup.
Come to The London Group on February 28th 2018 to find out more.
Are you ready to find out if you qualify or how much your R&D claims could be worth?