Did you know that you can borrow up to £100,000 for a business you’re yet to start or which is less than two year old?

 You don’t need to:

 put up any capital of your own,

• be a distinguished leader in your business field,
• know “all the right people”, or
• put up your home as security.

 

All you need is a cracking business plan, some believable cash flow and profit forecasts, proof that your market exists, and a handy accountant by your side. And we know a few of them!

 

Here’s Panthera’s guide on what you need to know to introduce funding into your company.

 

Who’s behind this scheme?

 

We all remember the credit crunch in 2008. Banks became even more cautious lending money to businesses, even established ones. Something had to be done to plug the gap so the government launched the British Business Bank (BBB).

 

One of BBB’s first moves was to launch The Start Up Loans Company (TSULC). What TSULC does is provide personal loans to entrepreneurs of up to £25,000 over one to five years with no early repayment fees or set up charges. The money must be used for business purposes.

 

The interest rate is fixed at 6% throughout the term – even if inflation rises, the interest rate will always remain the same.

 

Who can apply for start-up finance?

 

You can apply for this finance if your business is:

 

• yet to launch or
• has been trading for less than 24 months.

 

Not every type of business idea is eligible for funding – please click <a href=”https://www.startuploans.co.uk/eligibility-criteria/#loanpurpose”>here</a> to see the excluded categories.

 

Who do you apply to for this start-up finance?

 

TSULC have appointed delivery partners all across the UK. The idea behind this is that each delivery partner will know the economic requirements of each area better and be able to direct funding into businesses of the greatest benefit to communities and businesses in the vicinity.

 

In addition, the funding is just the start of it. You have access to 12 month’s free mentoring by someone who has been in business themselves or has successfully advised companies for many years.

 

To find out which delivery partners are closest to you, please <a href=”https://www.startuploans.co.uk/delivery-partners/”>click here.</a>

 

The process for applying for start-up finance from TSULC

 

There are five main things that delivery partners look for when assessing someone for a loan. They are:

 

• you have some experience in and knowledge of the sector you want to trade in,
• you have some indication of demand for your product or service (normally a few written of expressions of intent to buy are enough – invoices are even better),
• you have a business bank account into which you can pay the money,
• a detailed business plan, and
• you have a cash flow and profit and loss forecast that looks believable and achievable.

 

You’ll need to provide a CV. Be sure to highlight in your CV those areas of your career that support your application.

 

For your business plan, you’ll need to describe in detail the following:

 

• Business summary (your company and idea in a nutshell)
• What it is you’re going to sell (with short descriptions of each group of items or services)
• Market research including who’s going to buy from you, why they’ll buy from you, and how much they’ll pay you (here’s where you include any issued invoices or letters of intent)
• How you’re going to market and sell
• Who your competitors are and why you’re better than them
• Describe the day to day running of the business
• Who is going to supply you
• Other materials (including location, how you accept payment, how you fulfil orders, legal and insurance requirements, management team, staff already hired, and so on)

 

Backing that up will be a thoroughly prepared cash flow and profit forecast.

 

Panthera tip – don’t ask for any more money than you need. Make sure that there’s at least one month in your cash flow forecast where you show that you need all the money.

 

What happens next?

 

The application process takes up to 3 months from start to finish.

 

If you’re launching a new business, it would be better to make the application now so you’re not waiting around for the money when you’ve already opened.

 

For businesses under 24 months, most companies use money from TSULC for some form of expansion or purchase of equipment. Whichever it is in your case, make sure that the numbers stand up because, as it is public money, it will be rigorously scrutinised.

 

Start-up finance of £100,000

 

If your company has multiple directors, each director can apply for up to £25,000 each, subject to a maximum of £100,000 for a single company.

 

Risks

 

Even though the money is paid into your business account, any loan you receive from TSULC is a personal loan. You will be credit checked and if you have a bad rating, no matter how good your business plan may be, you will be turned down.

 

If your business fails, you are personally liable to repay the loan and interest. Whereas in most cases, loans to limited companies die when they go into insolvency, this will not be the case with a loan from TSULC.

 

Get help with your start-up finance

 

If you’re a Panthera customer and you want help with your business plan, please get in touch with the team on 01235 768 561 or email enquiries@pantheraaccounting.co.uk.