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Crowdfunding for growth

Crowdfunding for growth
Thursday, December 13, 2018

The crowdfunding sector has experienced rapid growth in recent years as a result of two key factors - technological innovation and the financial crisis. The financial crisis, even ten years on, still is putting constraints on the amount of lending offered by traditional credit providers to businesses in need of working capital or expansion capital.

The Financial Conduct Authority defines crowdfunding as “a way in which people, organisations and businesses, including business start-ups, can raise money through online portals (crowdfunding platforms) to finance or re-finance their activities. Some crowdfunding activity is unregulated, some is regulated and some is exempt from regulation”.

In this article, we’ll look at two different crowdfunding platforms and what they expect from you if you want to borrow money from them. We’re not suggesting by their inclusion that these particular companies are necessarily better than others. There are many others out there who should also be explored before a decision is reached. Please contact us to run through the options available to you.

Funding Circle

Funding Circle is the largest business crowdfunding site in the UK.

In order to be considered for a loan, your business must have at least 2 years’ filed accounts. Their typical client has a turnover of around £420,000 pa, employs 5-10 members of staff, and has been established for 8 years. 

They do not offer any form of equity funding - equity funding is a form of investment where you invest money into a business in return for a small shareholding. You can apply directly for a loan or through a broker.

A great deal of preparation is required before an application can be made to Funding Circle including but not limited to:

• your last annual accounts (the full version, not the one filed with Companies House)

• 7 your latest set of management accounts

• VAT,

• bank statements, and so on.

An explanation may be required if there have been unusual movement of money within your business such as asset disposal or purchase.  Any significant rise or fall in turnover may also require further explanation. 

Once all of the information requested has been provided, then your loan goes for approval by the Underwriting Team. If approved, your application will go to the Funding Circle Platform where investors can subscribe to your campaign.

In order for to get your loan, the investors must be prepared to put in the exact amount you have asked for. If the amount raised is just one penny short then you won’t get your loan. However, given that the platform is so well established, if you are listed on the site, you will almost certain receive your funding in full.

To find out more visit www.fundingcircle.com/uk

Seedrs

Seedrs is an equity based platform for investors and businesses alike. They may consider applications for start-up business finance but they seem generally more inclined towards early stage businesses. 

As with Funding Circle, you must be pledged the amount you want to receive however a distinct advantage over Funding Circle is you can accept more than you originally sought if it is raised.

There are number of other companies available for crowdfunding applications, each with their own specific criteria. However, all will require in depth financial information about your company and applications can be time consuming.

If you are considering crowdfuding as a means of raising capital, then a professionally drafted business plan complete with financial forecasts and other documentation substantially increases your chance of being successful.

Business plan preparation

Panthera Accounting work with our clients to provide conservative and believable business plans together with 3-5 years’ cash flow and P&L forecasts if you’re preparing your company for expansion.

To find out more, please call 01235 768 561 or email enquiries@pantheraaccounting.com.

What our clients say

For us, there is nothing better than a happy customer. Here are just a few that let us know how much we mean to them.

Pete Dungey

Simple, efficient and most importantly, hassle-free.

We found Panthera via our search for a Xero expert. We knew the software we wanted to use, and needed a forward-thinking accountancy partner who could get us up and running, and teach us the ropes moving forward. Tory and her team have always been on hand to answer our questions, and help us to grow as a business, particularly during periods of big change, such as becoming VAT registered. They are always on hand to alleviate any concerns and help to keep our records in order, which makes our year-end accounts an absolute breeze! Being based in Bristol, our relationship is entirely email based, alongside one consolidation meeting at year end - this keeps things simple, efficient and most importantly, hassle-free.

Pete Dungey Kaleido Grafik Limited
Anita van Eijndhoven

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The support and service we receive from Panthera Accounting is very good. Everything from regular meetings, a prompt e mail response and the transition of our Xero software (which we find very pro active indeed) has and is all remarkably efficient. We find Panthera talk our language and make any process as painless and easy as possible.

Anita van Eijndhoven Quidne-IT
Ash & Tim Lane

Panthera brush aside the stereotype of the typical accountant

We got in touch with Panthera Accounting by way of a recommendation; we haven't looked anywhere else since. They are an extremely professional yet relaxed group of people. We were slightly daunted by the idea of accountants but Panthera brushed aside y the stereotypes. They are very understanding when answering any questions we may have. They are completely efficient, offer sound business advice, and are fantastically priced. We will continue to recommend them.

Ash & Tim Lane Starveacre Fencing
Jayne Johnson

An Asset to my Business!

The whole team at Panthera are great! Working with them has been a huge support to my growing business. They help me to understand the numbers I need to know. They give me technology solutions like Xero so that I can process things quickly and have access to my own figures. They are quick to reply, highly knowledgeable, nothing is too much trouble and as well as making sure that everything is compliant and on time, they are enthusiastic, professional and fun to work with.

Jayne Johnson Better People
John Baker

Absolute joy - they provide a first class service on every level

Working with Tory and the team at Panthera is an absolute joy - they provide a first class service on every level; from simple Xero issues through to more complicated tax enquiries, they’re always on-hand to help me get it right. I’m certainly not their biggest customer, but I’m always made to feel like their most important one.

John Baker BKR Solutions
John Castle

Professional and Friendly

I would like to say that Panthera Accounting have helped me with my business accounts for more than 4 years now. They have consistently offered an excellent competitively priced service that works both professionally and in such a friendly way that I would highly recommend them to everyone considering using their services.

John Castle Ilexanna Limited & Birch Castle Homes Limited
Jonathan Morrison

They are always there to answer queries and sort out issues

I had been with Mr Dunn for 20 years when upon his death Panthera took over the business. They now play a bigger part in the running of my business, they do all the stuff that has to be done but I don't like doing ie book keeping, VAT, wages, and returns. They are always there to answer queries and sort out issues and make sure all Tax deadlines are met. Their costs are fair, service is great and I have and would highly recommend them.

Jonathan Morrison Wallingford Builders
Pippa Scott

Professional, friendly and personal service.

Panthera Accounting have gone above and beyond the call of duty to guide and support our Company. They offer a professional, friendly and personal service that can take the stressful and sometimes frightening feelings out of running a business. They have guided us through the working of Xero and have offered “teaching sessions” on the day to day running of the accountancy package. Our only regret is that we didn’t join their team earlier.

Pippa Scott Scott's Commercial Services Limited
Sara Southey

Panthera puts the personal back in to accountancy!

Tory and her team have provided a friendly, approachable and helpful service from the start. They have delivered a quality service, above and beyond anything I could have expected. Panthera, with the help of the Xero package, have taken the stress, strain and confusion out of managing my company and personal accounts. I look forward to working with them for many years to come.

Sara Southey Bluestones Garden Design
Tracey Miller

Panthera are fantastic.

Panthera are fantastic. Always professional, going the extra mile for their clients and delivering superb service. I recommend them all the time to my clients.

Tracey Miller Bigger, Brighter, Bolder BBB

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