Business Funding Opportunities in Devon and Somerset
According to the recent British Chamber of Commerce survey, we are fully entering a “cautious funding trend”, where both lenders and investors are further scaling back in the UK due to both political and financial uncertainty. The survey raised several interesting statistics:
- 65.3% of small businesses were profitable in 2022, but after the ‘post-Covid bounce’, this is under enormous pressure from supply chain inflation, staff and energy costs.
- Around half (49%) of businesses felt that getting funding had become more challenging over the past three years.
- Only 13% said it was getting easier.
Whilst accessing traditional funding is certainly a challenge for many, particularly with the cost-of-living crisis placing strain on supply chains and balance sheets, there are alternative funders in the region that can lend based on potential rather than collateral.
South West Investment Fund – £25k – £5m
The British Business Bank’s South West Investment Fund will deliver a £200 million commitment of new funding to smaller businesses. It aims to drive sustainable economic growth by supporting innovation and creating local opportunities for new and growing businesses across the South West.
Now that most SME lenders require a track record of profitability and/or are lending against EBITDAR performance (Earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs), the role of the South West Investment Fund has never been more important in providing finance to the region’s growth SMEs.
With a range of commercial finance options on offer, the Fund can provide loans from £25,000 to £2 million and equity investments up to £5 million.
Small Loans (£25k up to £100k) – SWIG Finance
Small Loans from £25k up to £100k are available for new or growing businesses across a broad range of sectors and can be used for a variety of purposes.
SWIG Finance is the appointed Fund Manager for the Small Loans element of the South West Investment Fund. At SWIG Finance, they can lend to projection-led businesses, and all of their lending decisions are made by people, not computers, which means that they are well-placed to support businesses when algorithm-driven lenders can’t.
SWIG recently supported business, Exeter Eyewear, with a SWIF Small Loan of £31k to support the creation of a new range of eyewear products. Read the full case study here.
Find out more about South West Investment Fund Small Loans here.
Debt Finance (£100k up to £2m) – The FSE Group
The FSE Group is the appointed Fund Manager for South West Investment Fund Debt Finance.
Debt Finance is designed for businesses that can demonstrate growth potential. Funding ranges from £100k up to £2m and can be used for several purposes, including hiring a new team, launching a new product or service, funding marketing costs or purchasing new machinery or equipment.
The FSE Group recently helped Somerset-based Gridimp with growth funding to support them as they increase their headcount and expand their HQ. Read the full case study here.
Find out more about South West Investment Fund Debt Finance here.
Equity Finance (up to £5m) – The FSE Group
The FSE Group also provides South West Investment Fund Equity Finance up to £5m.
Equity finance can be particularly important for new and innovative companies with high growth potential as it can provide long-term backing to fund business growth through to revenue and profit. An equity-based investment could be right if you run an established business with ambitious plans, or a large start up with high growth potential.
The FSE Group recently supported Devon based Rockfish Group with a £1.25m equity investment to fuel their expansion across the South West. Read the press notice here
Find out more about South West Investment Fund Equity Finance here.
Start Up Loans – £500 – £25k
The Start Up Loans programme is another British Business Bank initiative, designed to support businesses that have been trading for less than three years.
Funding from £500 up to £25k is available for new and early-stage businesses.
SWIG Finance is the South West’s Business Support Partner for Start Up Loans. Find out more about Start Up Loans here.
SWIG Finance supported Devon-based cocktail manufacturer, Bar Buoy, with funding to scale up. Read the full story here.
Representative example for a Start Up Loan of £10,000 repayable over 5 years: 60 monthly payments of £193.33. Rate of interest 6% per annum fixed. Representative APR 6.18%. The total amount of credit is £10,000. Total interest payable £1,599.80. The total cost of credit £1,599.80. The total amount payable is £11,599.80.
For any kind of loan product, terms and conditions apply, and credit is subject to status, affordability assessments and credit checks.
Grants
Grants offer a vital financial boost to businesses pursuing specific projects. Unlike loans, grants do not need to be repaid, making them an attractive option for businesses looking to fund business activities and growth.
The Heart of the South West Growth Hub can make Grant searches for you, and they also have some resources to help you understand the process.
While grants can significantly benefit your business, they can be hard to find. The application process is also not without its challenges. Understanding and overcoming these challenges can make the difference between a successful application and a missed opportunity.
For more information about researching available grants, navigating the grant application process and understanding the eligibility criteria, please contact the Heart of the South West Growth Hub here.
Contact The FSE Group
The FSE Group has been providing high-growth businesses with accessible market-gap funding since 2002. The FSE Group works with stakeholders and partners, including British Business Bank, Funding London and Local Enterprise Partnerships, to deliver regional funding that supports job creation and economic prosperity. Get in touch here: https://www.thefsegroup.com/about-us#contact
Contact the Heart of the South West Growth Hub
The Heart of the South West Growth Hub is here to provide advice, information and support tailored to your business needs. We do not provide, operate, or have any influence over grant decisions. If you’d like us to carry out a grant search on your behalf and signpost to organisations that can help you, get in touch here: https://www.heartofswgrowthhub.co.uk/contact-us/
Contact SWIG Finance
SWIG Finance is an award-winning ethical finance provider that provides flexible loans and support to start-ups and small businesses with growth aspirations. We base our lending decisions on potential, not collateral, which means that we can lend to projection-led businesses. Get in touch here: https://www.swigfinance.co.uk/contact-us/
