Raising money can be one of the toughest parts of starting a business. There are several options available to entrepreneurs when it comes to obtaining funding. Finding the right source and amount of capital is extremely important since most start-ups capitulate after only a few months mainly due to inadequate funding. At Verde Corporate Finance we have extensive experience and proven track record in helping start-up businesses in securing the right amount of funding to meet their ambitious needs.
Angel investors are often high net worth individuals that are willing to invest in new business ideas which catch their eye. To attract an angel, you need to have a good business plan and most importantly be passionate. Angel Investors often have a great deal of experience and valuable contacts in the industry they invest in, which can be very beneficial to entrepreneurs.
Venture Capital firms employ professional investors who can invest the funds in well thought out start-ups with proven business models. Venture capitalists often seek big opportunities that need higher funding in expectation of a higher return. They will usually seek to exit after a certain period of time so having a robust integrated financial forecast model, which clearly demonstrates the return on investment is extremely helpful in negotiations.
Seed Enterprise Investment Schemes (SEIS)
SEIS raise funds through individual investors by providing tax reliefs on investments. Through the scheme, claims can reach up to £100,000 per annum. The availability of relief depends on the company maintaining its qualifying status which Verde can distinguish for you.
Banks can provide loans to individuals who approach them with a solid business plan. The most obvious benefit of bank loans is that you will not have to give up any ownership of the company. However, you must ensure that you have a sufficient cash flow to handle repayments. A robust and reliable forecasted Cash Flow is essential in order to secure a bank loan.
Recently, we have successfully secured a loan for a start-up company Talentscape. They say “The Verde Team made us feel confident in seeking funding, we would highly recommend their expertise”.
Entrepreneurs can pitch their business ideas to a community of investors on platforms such as Kickstarter and Indiegogo. The business plan is shared on the social platform and individual investors are able to fund the company for a small ownership stake. Understandably, the competition levels are high, so the business plan needs to be captivating. Often Entrepreneurs will use videos or other media to put their message across.
Research and Development Tax Relief
If you are developing innovative products or services within the technology or scientific industry you could be entitled to R&D tax relief. SME R&D relief can allow companies to deduct a total of 230% of their qualifying costs from their corporation tax bill and claim tax credits if the company is loss making. Start-ups often invest significantly into R&D of their product and can greatly benefit from this relief. We have helped many different businesses with their claims, including one recent client was quoted “We had little knowledge on our R+D claim but Verde were there to show us the way – We would highly recommend”.
Starting your own business is an exhilarating experience, however in order to survive and thrive in this competitive market, it is important to get professional advice from qualified experts. At Verde Corporate Finance we helped many start-ups with sourcing the relevant funding, forecasts and R&D tax claims. If you would like to discuss your finance needs please get in touch through [email protected] and our team would be delighted to help.