The start of the new year can be an exciting time for businesses with new year’s resolutions and plans firmly in place. For many it is now a time for putting their growth plans into action, with the key question for many SMEs and early stage businesses being “How can we fund our growth plans?”
The foundation for any fund raise is a detailed funding proposal or business plan supported by a robust financial model. This document should demonstrate a firm understanding of the business, including a comprehensive knowledge of the market in which they operate (as well as their key competitors) and a clear strategy as to how the growth aspirations will be achieved.
The financial model should include the current and future funding requirements both from a working capital and capital expenditure position. This will enable the business to establish the quantum of funding required to facilitate the growth strategy, when it will be required and for how long. The detailed cash flow forecast is essential and should carefully consider both historic trends and the future cash flows to identify the peak funding required. The business should robustly challenge their forecast assumptions to ensure that the overall funding requirement in their cashflow is adequate.
Once the funding proposal has been finalised it is then appropriate to consider what funding options are appropriate. For businesses in Northern Ireland there are many funding solutions to consider from the mainstream banks to an extensive range of alternative finance options. At this time, it is crucial that the businesses do not get overawed and daunted when seeking the funding to support their growth plans. Taking time initially to fully understand the options is an essential step to ensuring that you do not consider an unsuitable type of finance.
GMcG Corporate Finance have an extensive network of funding partners and will be delighted to assist local businesses to deliver the most appropriate funding and support.
Robbie Milliken, Associate Director
