4th January, 2017 No Comments
Raising finance can be a difficult task. Entrepreneurs and experienced businessmen alike are talking about ‘the banks not lending’. This is also a common headline used in the press when writing about the economy and recession. When faced with such a statement, you often have to ask “So where have you looked? What lenders have you approached? Who else?”
Access to credit is vital for businesses to expand, develop new products and, ultimately, contribute to economic growth. Business West’s Quarterly Economic Survey – part of the British Chambers of Commerce national survey, which is a highly respected snapshot of economic conditions for business – asks ‘What barriers to growth have you experienced?’ and, consistently, one of the top answers is always access to finance.
Yes, lending has reduced since before the recession, but could this statistic potentially be somewhat due to a lack of knowledge of the different sources available? 71% of small business owners, in an AXA survey, said they had not heard of crowd funding and 54% were unaware of the existence of peer-to-peer lending.
In these uncertain political times, alternative sources of funding can offer a huge boost to small businesses and are an increasingly viable option for growth. Some people may say traditional methods of raising finance, such as banks, aren’t what they used to be, even though banks were never meant to be the ‘be all and end all’ when it comes to investment. It is important for business owners to understand the wealth of other opportunities out there, some which come with greater control. For example, Self Directed Pension Schemes are under used and arguably under rated for the purposes of assisting business growth. Pension-led funding is a type of commercial finance which offers an alternative to traditional business funding, such as bank loans or overdrafts, and involves using business owners’ accrued pension funds to invest in their own companies. Pension-led funding doesn’t require personal guarantees and enables you to use Intellectual Property (IP) as a legitimate asset class, which broadens the opportunity further. More than 1,300 businesses in the UK have successfully used this type of funding.
Other options including equity crowdfunding have become much more popular in the last few years, but it can be much tougher to pitch successfully online than clients anticipate – seeking advice beforehand is highly recommended. Angel investor funding can also offer mentoring support alongside investment, but valuations can be tight in some sectors and the process can be time consuming, so it’s definitely worth speaking to an expert to look at all the options available, then weighing up the pros and cons.
There are also other forms of finance such as grants. Grants are pots of funding for a specific purpose and are usually match funded. To find out if there are any grants to suit your purpose and to check eligibility criteria, visit the Gov Support Finder.
What businesses need to understand is that there are other ways to access funding and different solutions can be found. But, it’s important to ask, why should someone lend to you or your business? The answer is they shouldn’t, unless you can prove to them that you are worth investing in.
Written by Tara Gillam, Head of Enterprise at Business West delivering business support in the South West.
6th September, 2016 No Comments
No one can doubt that since the vote on the 23rd June to leave the European Union there has been a great deal of political and economic uncertainty. Equally there can be no doubt that the performance of Team GB at the Rio Olympics has lifted our spirits and demonstrated the skills and resilience of our athletes sporting success at the very highest level, encouraging us all to participate in some way or other.
Of course the outstanding sporting achievements also required substantial lottery funding in which to support and back the winners. Funds have been targeted at those most likely to deliver results, and this policy is one that also applies in business, and no more so than in supporting new start-ups and entrepreneurs.
You only have to look at Team GB’s success in Rio to see how this targeted approach produces outstanding performance and reap rich dividends, and this is the approach that Cavendish Enterprise has adopted in delivering the Start & Grow programme. Now in its second year Start & Grow is designed to accelerate business growth ambitions which lead to increased turnover, profitability, job creation and expansion.
The programme wants to attract the best entrepreneurs with new ideas, an ability to work hard, and who are passionate about winning with a steely determination to succeed in their business venture. Just as new Olympic and World records were set in Rio, so the barriers to enterprise are falling all the time, and people are finding new ways to develop their ideas.
In his new book ‘Screw Work-Break Free-How to Launch Your Own Money Making Idea in 30 days‘, the author John Williams, says that there are only three questions people need to ask themselves when seeking a new business venture: –
1. What are you really good at?
2. What are the things you have always wanted to do but never managed?
3. What are the things that most bug you in life that you could do something about?
Our watchword should be ‘carpe diem’ : ‘seize the day’. Britain remains one of the best countries in the world in which to start and grow a business. Cavendish Enterprise partners prove that every day. Since the Start & Grow programme commenced, we have supported 530 new entrepreneurs to start up in business, realising new investments of over £8.5 million, and creating 1,235 new jobs. And this is just the start.
We must retain and build on this positive attitude for enterprise and business in general. At a recent reception in Downing Street, the Prime Minister, Theresa May, called entrepreneurs and small businesses the ‘backbone of Britain’.
Whilst it is far too early to draw any substantive conclusions about the economic impacts of the Brexit vote, there can be no excuses for not continuing to encourage people to realise their full potential for starting a new business. What is needed is a new generation of entrepreneurs of all ages and backgrounds, who can innovate and create wealth. Cavendish Enterprise is dedicated to this challenge.
Whilst the route to self-employment and creating a successful business is never easy, there is a wide range of support available. Take for example VENTUREFEST, and the regional event for the North West which is to be held in Manchester on the 21st September 2016. Organised by the Business Growth Hub, this promises to be a great day for innovation, networking and connecting entrepreneurs, innovators and investors.
Businesses will have the opportunity to meet up with no less than 10 different funders on the day. Other topics to be covered include: –
– what investors are looking for in pitches from entrepreneurs;
– supercharging innovation and inspiring new entrepreneurs;
– acquiring knowledge from Universities and Science Parks to support innovation and growth
The Manchester event is just one of many being held around the country, so there really is nothing to hold you back, apart from fear itself.
Let me, therefore, finish this blog with a quote which I hope will spur you onwards and upwards, just like the medal winning athletes in Rio: –
“Be brave enough to believe in the future, and try something different.
Be energetic enough to see an opportunity.
Be optimistic enough to deny the possibility of failure”
Written by Sylvia Philips, CEO of BBV Ltd, delivering business support in the North West.
11th August, 2016 No Comments
Our latest Guest Blog from LawyerFair, the on-line law services platform, reviews how pricing in the industry looks set to be revolutionised:
LawyerFair recently delivered a presentation to 80-100 business owners and opened with a simple question … “How many of you, when instructing lawyers for your business, had advanced knowledge of your fees?”
Remarkably, but perhaps not surprisingly, the show of hands was zero.
Not one business owner, in a room of relatively sophisticated and regular buyers of legal services, had forward visibility of costs on their legal fees. And this anecdotal experience of how lawyers still charge, has been endorsed by a recent report from the Centre for Policy Studies – The Price of Law – which accused law firms of “using a lack of transparency on fees to distort the free market in a way that creates inefficiencies and undermines the wider economy.”
The report continues “The high level of legal fees is an efficient drain on commerce. British industry is forced to suffer a deadweight loss as excessive amounts of time and money must be spent dealing with legal issues.”
Jim Diamond, former lawyer and author of The Price of Law, revealed in an article in the Daily Mail that firms typically bill in six minute units of time, and that “for typing ‘yes’ or ‘no’ and hitting ‘send’ on an email, the partner might count it as a six-minute time unit and bill £110 for 30 seconds’ work.”
To those who know how the traditional solicitors model works, this report is hardly a surprise. Law firms continue to measure success, by the growth of their hourly rate … an anachronistic charging model, that places all commercial risk on the shoulders of the buyer.
But, there are shifting sands in the legal market, and the era of guesswork surrounding expertise and cost is coming to an end.
We’re addressing some of these issues with my own platform at LawyerFair, where we pre-approve all panel lawyers and insist that quotes are fixed, but other services are emerging that help shine a light into this opaque market.
One particular service that’s starting to ruffle legal feathers is Premonition. Co-founded by a Brit, now based in Florida (Toby Unwin), the service utilises big data and Artificial Intelligence, to expose which Lawyers win the most cases, and in front of which Judges. It’s ground breaking transparency and, having already caused a stir in the US, it’s expanding into the UK and beyond.
Buyers of commercial legal services – from start up to general counsel – have suffered from a lack of transparency in legal services, but in this new era of legal procurement, a variety of services have emerged that have started to shift the balance of this industry from supply led, to demand led.
You might say that historically when it comes to fees, it’s the land of the blind where the one eyed lawyer is kind but …. in the future landscape of legal services, consumers with market intelligence will be King.
Written by Andrew Weaver, CEO & Co-Founder of LawyerFair
If you would like to compare legal fees, LawyerFair can do an audit of fees for free, as well as offer legal advice, so please do get in touch.
9th August, 2016 1 Comment
You’ve come up with a great idea for a new product or service and you need support, whether it be financial, technical, or professional partnership. The next step is convincing the right person to give you that support.
So what do you have to do?
Finding the right audience to pitch to is the obvious first step (and there’s a few links below to help with the search), and then you have to prepare your pitch. And prepare you must! Your idea will be as clear as crystal in your own mind but you have to portray that idea to others with the same clarity.
Whether pitching to a friend or associate, a group of business angels, or a bank manager, and whether it be face-to-face, using a business plan, or online, there are some fundamental rules to ensure you make your pitch the best it can possibly be.
Make sure you have all the relevant facts and figures at your fingertips – have a print-out with you that you can refer to both at face-to-face pitches and when preparing a written or online pitch. You should also consider producing a one or two page brief summary; use your business plan as a back up to your pitch (in some cases your business plan will form the major part of your pitch – particularly if you’re talking to a bank about finance); consider producing a PowerPoint presentation; and develop a 5-minute elevator pitch.
Investors are as interested in the entrepreneur as they are in the business idea (maybe even more so) so prepare yourself too! Be confident in your idea and show a passion for the business. Investors need to know that you are logical, efficient, quick-thinking, and able to see your idea through. They also need to know who you are, so be yourself!
Practicing your elevator pitch for face-to-face meetings will bring confidence but you also need to have answers to all the potential questions that might be asked of you. Know your product, costs, market, and processes inside out and you will not be caught out by questions you cannot answer.
‘Knowing the enemy’ will give you an advantage too. Research the investors wherever possible and use the information to your advantage to benefit your business – do they have experience in your industry? ; have they invested in a similar business before and how successful was this? ; how much time do they have to support you and your business? Pitching to the wrong people is both a waste of their time and yours!
Pitching your idea
Spencer Waldron, presentation expert at Prezi, suggests that the best pitches tell a story. Consider formatting your pitch with an introduction, a middle section of ‘chapters’, and an end where the main character in the story is your proposed market / customer.
The introduction could cover what is available now and the gap in the marketplace that your product or service will fill. The middle chapters will cover your target audience and their needs; why your product will benefit them; why they will buy from you; who might stop your business being successful and how you will counteract this. And the end would be the growth plan for your business and your exit strategy. It would be worthwhile adding a brief summary which highlights the 3 things you want people to remember from your pitch – choose the 3 wisely!
Ensure your content covers all the issues that your potential investors will want to know about: customer base; your team; costs and financial forecasts; competitors; and, of course, what exactly is it you want from the investor (and, where applicable, what do they get in return).
And finally your presentation should be well designed – smart, crisp, and to the point. And make sure your personal appearance is as polished as your presentation. In any printed or digital material keep text to a minimum; highlight important parts with ‘bold’ / text size / text colour; discuss one point at a time (in a PowerPoint that’s one point per screen); and use photos and images wherever you can. Finally, maintain your branding throughout your presented materials.
So, there you have it – pitching your business idea is easy, isn’t it?
Written by Davina Young, Marketing Manager at Cavendish Enterprise
Cavendish Enterprise partners are able to advise and support you in writing your business plan. Our business advisors can also assist with other skills and knowledge you may need to develop your business idea.
Some useful links:
Once you’ve got your pitch ready, the following links may be useful:
Looking to start a food and drink business? Pitch on 16th Sept 2016
1st August, 2016 No Comments
You have a business idea ……….. the inspirational ‘Eureka!’ moment.
And of course you want to get started immediately. But there are a few things you need to consider in order to validate your business idea, as well as the need to produce a supporting business plan. Ask yourself the following;
Is your business original?
Using a search engine and social media sites to search for your idea can show you whether your business is original, but remember to look beyond the first results page.
Researching your competitors is essential if you are validating your business. If there are similar products or services on the market already, having competitors is not necessarily a problem. It just means there is a demand for your product or service and by identifying your competition; it will help you to recognise what differentiates your business.
If you have a unique selling point (USP), you will be able to win and maintain a higher share in the market. You can also learn from other business’s mistakes and successes by understanding how they promote themselves and who they target. Google Trends can also be useful for validating whether you are going into a stable or growing market.
Can you validate the demand?
You can reduce the risk of selling something that nobody will buy by validating the demand for your product or service and its market. Compiling a list of potential customers will also help to reduce the risk of low traffic in your initial few months.
A way to find out if customers would be willing to pay for your product or service is to set up a free landing page. Useful sites for free landing pages are Strikingly and Launchrock. Strikingly uses no code and you do not need any design experience to build a page. Launchrock is also easy to use with a block-based builder and custom HTML blocks.
Landing pages will usually feature a short snippet about your product or service with ‘coming soon’ or ‘in development’. The key is to make your landing page attractive to capture the email addresses of visitors. You can see how many people are visiting your site by using an analytical tool such as Google Analytics, or by creating a sign-up form using sites such as Wufoo. This sign-up form will ask people to leave their email address if they would like more information on your idea or your launch. If lots of people visit the site, you will know people are interested in your idea.
Another way to validate your business is to send out surveys. By using tools such as SurveyMonkey, you can send it out to all your contacts and get it shared on social media. It is important to ask the right questions so you can gather as much information about your idea as possible. Examples could be:
• Would they buy the product or service?
• Do they like the name of the product/business?
• How much would they pay?
The answers to these questions can help shape the final launch of your idea and give an indication of how successful the idea can be in comparison to how many people are engaged.
Have you produced a business plan?
Your business plan is the document that allows you to turn your thoughts and ideas into a business. It may seem like an intimidating task but it is a valuable document outlining your business strategies and makes you think about every aspect of the business to understand it thoroughly.
As your business progresses, your time working on the business will become more limited as you spend more time in the business. Consulting your business plan can allow you to make more informed and effective decisions and ensure you are keeping on track.
Also, a business plan is vital for anyone seeking or thinking of seeking finance, now or in the future. Banks, investors and other lenders will expect to see a business plan and will not provide capital without one. It provides them with an overall understanding of the business and the likely returns. Keep you business plan active so you are able to refer back to it and keep business progression on track.
Are you asking for help?
There is nothing wrong with asking for help when you are starting a business.
There are numerous services to provide you with the support and guidance you might need. Industry experts can help you understand how to make the most of opportunities and further identify the needs your target market. A mentor is a valuable asset to anyone starting a business and this avenue shouldn’t be overlooked. A mentor can give you one-on-one support and provide you with dedicated advice and guidance.
Another great way to get your business off the ground is to attend seminars and workshops which can help you develop necessary skills and knowledge. You can get support for your start-up through the Start & Grow programme which is tailored specifically to your needs and your business idea.
Written by Tara Gillam, Head of Enterprise, Business West – delivering business support in the South West