In business we all sometimes need that extra little bit of cash to get certain business ideas off the ground. There are many ways in which you are able to gain extra business finance such as loans, overdrafts, credit cards or through private investors such as business angels; however what do all of these have in common? They all have to be repaid in one form or another but with a business grant it’s another story.
Business grants are a sum of money that is awarded to your company for a very specific purpose or project. This money means that you can undertake the changes that you want to make to your business without having any debts at the end of it; sounds too good to be true? Well let me assure you this is completely genuine but like all things that seem too good to be true there are a few catches. You are only awarded between 15% and 50% of the total money that you need to carry out your project; the rest of the money needed has to come from you. The percentage of the total cost that you will be awarded depends on how much money you need for your purpose or project.
There are many ways in which you can obtain a grant some of the main ones are as follows:
• The government
• The European Union
• Regional Development Agencies in England, Scottish Enterprise, the Welsh Development Agency and Invest Northern Ireland
• Local authorities or local councils and local development agencies
• Chambers of Commerce
• County Enterprise Boards
The main type of business grants that are available are government grants and the reason that they came about was as a way of encouraging entrepreneurialism and innovation, which will translate into opening up more jobs within the business and adding value to the business, which is done mainly through the businesses profits.
Some of the reasons as to why you may be awarded a grant are for the purchasing of machinery, to improve office conditions, increase employment and developing export markets. Everything that it will be awarded for comes down to the idea of helping you to develop your business.
To be in with a chance of receiving a business grant you need to make sure that you meet the conditions set out by the grant. These conditions are that you have to have the rest of the money for your specific project or purpose ready and the project can’t have already been started. These are strict terms and conditions that apply to all grants. If these aren't followed, immediate repayment of the grant can be required. However, generally you do not have to repay grants or interest on them unless you break the conditions.
Applying for grants can be time-consuming. You will generally be required to submit your business plan, as well as completing the specific paperwork for the scheme. Once your application has been made it will enter the reviewing stage where your application and proposal will be assessed using the following criteria:
• Significance
• Approach
• Innovation
• Their assessment of your expertise
• Need for the grant
There aren’t many grants available, which means that competition for them is high so if you aren’t successful this time then I advise you to take on board the reasons as to why your application was turned down so that you can work on these points and apply again.
Helen is the web master of Angel Start-Ups, who are experts in all aspects of Business Finance, which includes Business Grants.
Showing posts with label bank loans. Show all posts
Showing posts with label bank loans. Show all posts
Wednesday, 20 August 2008
Monday, 7 January 2008
Business Finance
If you have this great idea you think has the ability to make money but also make you a successful business person then why not make it a reality. Well one of the biggest problems with making it a reality is usually financial backing. Not everyone has the finance available there and then to make their dream a reality and many give up on their dream because they think they have no chance of getting the finance they require. If you’re thinking that’s me then I think you need to continue reading this article!
You will need finance for purchasing equipment whatever it may be from computers to ovens, a place of work if necessary if you intend to employ staff you will need an office, factory or warehouse to hold stock if there is any. Once your business is up and running you will need money to pay staff, pay bills and keep the business running as well as promoting the business to your targeted audience.
Finding the finance you require can be one of the most difficult aspects of setting your business up but it can be made simpler if you plan your new business set-up and future using a Business Plan. A business plan will allow you to record all your ideas; you plan for the future all the goals you intend to set yourself and your business. The business plan will set out your businesses objectives clearly and thoroughly, allowing you to go and back and remember them as well as showing potential finance partners to understand fully what your business is about and how you want it to succeed.
The financial options available to new businesses are that of:
• Family and Friends
• Your Savings
• Credit Cards
• Bank Loans
• Business Angels
• Venture Capitalists
• Government Support and Grants
If you don’t have savings like many people don’t and your family and friends can’t help, you have the option of using your credit card but this can be dangerous and most credit cards have a limit of £5,000.
Bank loans can offer a certain amount of money as well as using your account overdraft if available but you have to remember you will pay interest back and if you can’t show the bank a credible business plan, that you’re good at working in business and have evidence for this, that you yourself can invest some money into the business as well as offering security on the money lent to you using your personal assets as a guarantee.
If the bank turns you down, you may have the option of a loan for small businesses called ‘Small Firms Loan Guarantee (SFLG)’. This provides lenders with a government guarantee against default in some circumstances. This is ventured by the Department for Business, the Enterprise and Regulatory Reform (BERR) and other lenders.
Business Angels and Venture Capitalists are similar in many ways they both offer finance to new or struggling businesses which they think will succeed with their financial help, they both take a share of the business and they usually offer around £10,000 to a business. This figure can be a lot more if angels or capitalists group together and become a network or syndicate. Business Angels usually give you the finance you require and let you run the business on a day-to-day basis and watch their money financial investment increase gradually whereas Venture Capitalists usually like to take an active role in decisions being made and like to become a director or part of management of the business.
Whatever finance you require to set your business up, make sure you have a well planned and thorough business plan in hand when you make any financial decisions as well as approaching potential financial investors from family to friends to the bank to business angels.
Jene Pedder is the Webmaster of Angel Start-Ups who specialise in offering help finding appropriate Business Finance.
You will need finance for purchasing equipment whatever it may be from computers to ovens, a place of work if necessary if you intend to employ staff you will need an office, factory or warehouse to hold stock if there is any. Once your business is up and running you will need money to pay staff, pay bills and keep the business running as well as promoting the business to your targeted audience.
Finding the finance you require can be one of the most difficult aspects of setting your business up but it can be made simpler if you plan your new business set-up and future using a Business Plan. A business plan will allow you to record all your ideas; you plan for the future all the goals you intend to set yourself and your business. The business plan will set out your businesses objectives clearly and thoroughly, allowing you to go and back and remember them as well as showing potential finance partners to understand fully what your business is about and how you want it to succeed.
The financial options available to new businesses are that of:
• Family and Friends
• Your Savings
• Credit Cards
• Bank Loans
• Business Angels
• Venture Capitalists
• Government Support and Grants
If you don’t have savings like many people don’t and your family and friends can’t help, you have the option of using your credit card but this can be dangerous and most credit cards have a limit of £5,000.
Bank loans can offer a certain amount of money as well as using your account overdraft if available but you have to remember you will pay interest back and if you can’t show the bank a credible business plan, that you’re good at working in business and have evidence for this, that you yourself can invest some money into the business as well as offering security on the money lent to you using your personal assets as a guarantee.
If the bank turns you down, you may have the option of a loan for small businesses called ‘Small Firms Loan Guarantee (SFLG)’. This provides lenders with a government guarantee against default in some circumstances. This is ventured by the Department for Business, the Enterprise and Regulatory Reform (BERR) and other lenders.
Business Angels and Venture Capitalists are similar in many ways they both offer finance to new or struggling businesses which they think will succeed with their financial help, they both take a share of the business and they usually offer around £10,000 to a business. This figure can be a lot more if angels or capitalists group together and become a network or syndicate. Business Angels usually give you the finance you require and let you run the business on a day-to-day basis and watch their money financial investment increase gradually whereas Venture Capitalists usually like to take an active role in decisions being made and like to become a director or part of management of the business.
Whatever finance you require to set your business up, make sure you have a well planned and thorough business plan in hand when you make any financial decisions as well as approaching potential financial investors from family to friends to the bank to business angels.
Jene Pedder is the Webmaster of Angel Start-Ups who specialise in offering help finding appropriate Business Finance.
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