How To Score Grants & Funding For Your Startup

99.9% of the 99.3% of small private sector businesses in the UK are SMEs according to 2017 statistics. If you are one of them, you will know that of all the concerns a small growing business has, finance is probably the biggest one. It is the issue that causes the most sleep loss, the most coffee consumption, the most anxiety, the most arguments. Even top CEO’s still worry about finance despite their business being worth billions of dollars according to a media article, which stated top New Zealand CEO Michael Whitehead still worries about cash, despite having a huge team of accountants helping him manage his accounts. It is and always will be such a big concern and so, it is so important for every SME and especially startups to think about finance and how they can secure it. To think about financing ahead of time, to have finance plans and backups and ideas.

Funding For SMEs

At the heart of everything the business is doing, finance should be a priority. One really good thing to do when you have a startup, is to look into funding. There is funding available, and although it can be incredibly stressful and complex to get that funding, it is certainly worth looking into because it is financial support your business could make good use of. There are many different types of support, each with lots of complex rules and regulations and hoops you need to jump through just to apply. But they are all still a chance at funding you wouldn’t have otherwise. The money is there to be taken, and now is the time to try and get it.

Different Types Of Financial Support For Businesses  

The idea behind the funding provided is to help startups and growing businesses to flourish. It also helps businesses grow, and encourages entrepreneurs to start businesses and ultimately boost the economy. The money is usually taken from tax paid by taxpayers and gets distributed through a variety of outlets. At any one time, a business could be eligible to apply for a few different grants and types of financial support, provided in different ways.

Who Provides The Grants?

The Government, The EU, and your Local Authority provide financial support for SMEs and startups. Obviously, the UK is leaving the EU but, as it stands in Spring 2018 we are still in the EU so, grants and support available still stand at the moment.

EU Grants & Funding

Until we leave the EU you can still apply for the grants and funds on offer from the EU. The EU has a page where you can find out if you are eligible for any funding from their different programmes.

Local Authority Grants & Funding

There are nearly 40 different LEPS (Local Enterprise Partnerships) in the UK that you can apply to for funding.

Government Grants & Funding

There are currently thousands of grant schemes running for UK startups, so lots of opportunities for businesses to get some money coming in.

The following grants and financing from the government are definitely worth taking a look at:

SEIS – Tax breaks for investors (to help you win more investment).

R&D Tax Credits – A tax credit scheme for startups.

Innovation Grants  – Grants for innovative new startups.

Patent Box  – Tax breaks for UK startups.

SBRIs – Grants for UK startups.

Innovation Vouchers – Specific project funding and grants.

TSB Schemes For Random Competitions – Grants for startup competition winners.  

These are just some of the many different ways you can get grants from the UK government. There are also various departments where you can apply for funding such as the Department for Education and the Department for Transport. There is no one list of everywhere you can apply but this financial support for businesses page on the

Government’s website is a good place to start.

The Different Types Of Grants On Offer

There are various types of grants on offer from the Government, so the cash gets to your business in a number of ways.

  • Direct Grant – This is where you receive a direct grant for something you need money for such as training or product development.
  • Soft Loans – A soft loan is where you can get a loan, but the conditions are less harsh than with a normal company. Interest rates could be lower, or you might be able to pay it back over a long period of time.
  • Equity Finance – A set amount of money goes into the business in return for a share of the business. Once the value of the business increases the stake in the business is given back.
  • Free Business Advice – Where there are skills lacking in a business, sometimes those skills can be accessed for free or for a low cost.
  • Resources – Business can be supported with the resources they need to grow.

Other Types Of Business Financing

Although there are many different types of grants and loans available to businesses, you are not guaranteed to get the financial support. Conditions and rules are strict, so you can’t rely on these schemes for funding. You have to look at lots of other ways to ensure financing for your business needs, as well as your hopefully growing income from sales. Invoice financing, equity funding, and venture debt are all common ways to raise financing for startups and SMEs. So if you are part of the 660,000 businesses who started up last year or any of the 80 new companies being born every hour, try to ensure you secure funding in a variety of different ways, so you have backup plan after backup plan to fall back on, avoiding the risk of being one of the 4 in 10 businesses that die every year in the UK.

 

If you are really unsure where to begin with finding funding for your startup, this article by Virgin Startups is comprehensive and a really good place to start.

“It’s almost always harder to raise capital than you thought it would be, and it always takes longer. So plan for that.”  – Richard Harroch