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Tag Archive for Equity
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BGF pitches £15bn growth fund for struggling businesses post-coronavirus
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Business Growth Fund is proposing a £15bn growth fund to help businesses struggling under the weight of coronavirus emergency loan debt.
Stephen Welton, chief executive of Business Growth Fund, is talking to investors, the Government and his banking shareholders about the new fund. BGF’s shareholders include Barclays, HSBC, Lloyds and RBS.
Welton told the Financial Times that the UK faces a more devastating economic crash than the Great Recession of 2008, warning of “a totally unsustainable debt mountain” following the Government’s emergency coronavirus lending schemes.
Like others, Welton believes that many businesses will be crushed by this debt mountain, forcing them into bankruptcy and making a lot of people redundant.
Target viable businesses
The BGF fund would specifically target viable businesses that have borrowed money from the Coronavirus Business Interruption Loan Scheme (CBILS) but cannot repay it, because of the complete absence of customers.
Like the Future Fund, any BGF investment would have to be matched by private investors, which could include pension funds. Welton said that he had been talking to a couple of institutions about them coming on board. It has long been an ambition of his to have pension funds diversify into supporting fast-growth British
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Government eyes taking equity stakes in tech start-ups
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
The government is considering various rescue packages to help Britain’s tech sector start-ups excluded from business rescue schemes announced so far.
Although government has lauded the UK’s tech sector as the spearhead of Britain’s new economy – Boris Johnson wrote the foreword to Tech Nation trumpeting UK tech investment report last year – banks are refusing to offer state-guaranteed loans to loss-making start-ups.
Yet France has announced a €4bn (£3.5bn) start-up bailout fund – called a liquidity plan – to help French start-ups stricken by the coronavirus crisis.
One idea being considered is the government offering loans to start-ups, which could either be repaid by businesses after the crisis or turned into equity stakes in tech start-ups owned by the state. Venture capital would have to match whatever the government invests, according to the Financial Times, to prove commercial viability and also keep within EU state aid rules, which ban direct state intervention.
See also: Why government needs to boost EIS tax relief to 80% to save our start-ups
It would be similar to 3i, then called the Industrial and Commercial Finance Corporation, the government scheme launched after the Second World War to help regenerate the economy.
Business Growth
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Small businesses receive a record £6.7bn in equity funding
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Small businesses received a record £6.7bn in equity funding in 2018, a 5pc increase year on year.
The average deal size was £4.5m, an 11pc increase compared with 2013.
The UK’s white-hot tech sector received 44pc of small business equity funding. Backing for tech businesses increased by 24pc in 2018 with £3bn invested, the highest amount to date.
Small business equity funding outside London increased by 29pc as the capital’s influence as an SME hub waned. The East of England, North East and West Midlands were the three regions driving this regional uptick, where equity finance investment deal sizes grew by 118pc, 115pc and 81pc respectively.
Several UK regions also saw a significant increase in the overall number of deals – up by 65pc in the North East, 15pc in Yorkshire and Humber and 11pc in Wales.
Keith Morgan, CEO of British Business Bank, said: “We are particularly pleased to see a 29pc increase in investment outside of London. The British Business Bank continues to work to address regional imbalances in access to investment to ensure smaller businesses across the UK can access the equity finance they need to fulfil their growth potential.”
Indeed, the UK venture capital sector
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How to choose the right finance option for your SME
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
A huge 99.9pc of the UK’s 5.7 million private sector businesses are SMEs, making them crucial for a healthy economy and jobs market. But the failure rate of SMEs is staggering, with less than half surviving beyond the first five years. Maintaining operating cash flow is a massive cause of business failure because of the way business lending for SME finance is assessed.
Funding is a major barrier to SME growth, with more than half of SMEs struggling to get the funding they need to help boost productivity develop their product offerings and scale as a business, according to Close Brothers.
Often, many resort to selling stakes of equity to secure the much-needed cash that could take their business to the next level.
Difficulties SMEs face getting funding
Small businesses often struggle to get funding as they are deemed too much of a risk and are not making enough turnover to convince prospective lenders. Heritage banks require businesses to have strong personal and business credit scores— and the latter may not be something an SME will have if they haven’t taken out a business loan in the past, or if they have existing debt from other lenders.
Banks
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Caution! The 4 Questions You Should Ask Before You Part With Equity
by Doug and Polly White • • 0 Comments
Think hard before giving up a slice of your pie. Still, equity is a great recruiting tool, so don’t be “penny-wise and pound foolish,” either.
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Crowdfunding on Indiegogo: A small business guide
by Ben Lobel • • 0 Comments
Indiegogo empowers people from around the world to raise funds for any idea by turning to the ‘crowd’ instead of banks or venture capitalists. At its core, Indiegogo is an open platform dedicated to democratising the way people raise funds for any project – creative, entrepreneurial or cause-related. As the largest global crowdfunding platform, campaigns have
The post Crowdfunding on Indiegogo: A small business guide appeared first on Small Business.
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6 Tips for Successfully Splitting Equity in Your Startup
by Drew Hendricks • • 0 Comments
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ViSalus Offers Shares – Equity To Distributors
by Ted Nuyten • • 0 Comments
The ViSalus Co-Founders, Ryan Blair, Blake Mallen and Nick Sarnicola, have often maintained that “equity” is the most valuable asset one can have in business. Starting in 2015 they made 6% of the shares available for distributors.
According to the ViSalus website:
“Beginning in 2015, the year we celebrate our 10th year, leading Promoters will have an opportunity to earn from a special Founders’ Equity Incentive Plan and share in the company’s future success together.
The Founders Equity Incentive Plan provides Promoters with an ownership opportunity equivalent to 6% of the company, awarded over 2 years (3% allocated in 2015, and 3% allocated in 2016).
The Plan is shared among 4 Equity Groups, based on your Paid Rank each month.
This is a once in a lifetime chance to own your legacy and create something truly great – not only for today, but for your future. By personally reaching and maintaining leadership ranks of National Director and above, then helping your personally enrolled team do the same, you’ll earn equity in the plan and be able to proudly call yourself a Vi Equity Holder”.
Nick Sarnicola Explains The Future of Vi for 2015
//www.youtube.com/watch?v=IaotbajeARI
The Founders Equity Incentive Plan provides Promoters with an ownership opportunity equivalent to