business focus 13


Chartered accountants Haines Watts presents a series of articles based on its blogs. It offers analysis, reviews and comments and welcomes your feedback at www.hwca.com/blog


of the month


Sowing the seeds: non-bank funding for SMEs writes Jane Wills, partner at Haines Watts


With the economy showing signs of a gradual recovery many business owners have again turned their attention to growth. With growth comes the requirement for funding but this, it seems, is still difficult to obtain.


It’s widely acknowledged that the banks are no longer meeting the funding needs of the vast majority of SMEs. With our own clients we see banks remaining very selective in their approval of funding. Banks are falling over one another to lend to the asset-rich or cash-rich owner-managed businesses (which invariably can fund their own expansion) but loathe to lend to businesses where the primary asset is IP or people.


Small businesses need to find funding that enables them to


deliver jobs and achieve growth now. Bank lending is unlikely to increase significantly – so alternatives are required.


The Internet has proven to be a great leveller through its ability to put lenders in touch with borrowers in innovative ways. Although it has been around since 2007 in the UK, Peer-to-Peer funding (P2P) is now gaining rapidly in scale and appeal. The likes of Funding Circle and Crowdcube are doing for SMEs what traditional banks can’t. Look at cases like Webster Homes which, through crowdfunding, raised 75% of the capital they required to begin work on a small housing development.


Angel investment by high-net- worth individuals is also on the increase – thanks in part to the 50% tax relief on investments of up to


Rapid growth brings Silver to BDO’s reward team


Accountancy and business advisory firm BDO LLP in Reading has appointed Amy Silver to its fast growing reward team.


Part of the 180-strong team based in Reading, BDO’s reward department is the largest in the Thames Valley that focuses specifically on reward and employee incentivisation.


The firm now has six people dedicated to providing reward-based advice to clients – from just two 12 months ago. Headed by director, David Gardner, the team is targeting £1 million revenues this year.


Commenting, Gardner said: “As businesses in the Thames Valley set their sights on growth, attracting and retaining the very best talent is a key part of their expansion plans.


“Because of this, and in light of the introduction of the new Employee Shareholder Status (ESS) scheme, the need for quality tax and reward advice has burgeoned. We’ve continued to invest in our own team’s growth and expertise and we’re delighted to welcome Amy aboard.”


The BDO reward team has a mix of tax professionals and lawyers providing businesses with advice on all aspects of employee remuneration, share incentives and international share plans, as well as the tax implications for employers.


Details: Ian White


0118-9527356 ian.white@bdo.co.uk www.bdo.co.uk


THE BUSINESS MAGAZINE – THAMES VALLEY – NOVEMBER 2014 Amy Silver (left) and the BDO Reading reward team www.businessmag.co.uk


£150,000 via the Seed Enterprise Investment Scheme.


While traditional banks remain deeply unpopular in the UK there are some new entrants focusing specifically on the SME market that are worth watching. For example, Shawbrook and Aldermore banks offer deposit-funded loan finance for SMEs. Tech City will no doubt be watching keenly the Silicon Valley Bank; it’s a US-based specialist bank providing ‘venture debt’ to high-growth tech and biomed


companies, which is looking to obtain a UK banking licence.


More established alternatives to help those SMEs who need cash quickly are still available through asset-based lending or invoice financing.


A wide range of new and, in some cases, ‘disruptive’ finance providers are positioning to target the SME market. They are not without risk and regulators have expressed some concerns over the lack of regulation in this arena – but for SMEs who are tired of begging ‘cap- in-hand’ the choices are welcome.


Details: www.hwca.com


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