Running your own business is an exciting prospect. It allows you to follow your passion and take ownership of your own career.
Running your own business is an exciting prospect. It allows you to follow your passion and take ownership of your own career. But the benefits of becoming your own boss come with challenges and, while there are no shortcuts to start up success, there’s a lot of help and information out there for those just starting out or looking to grow an early stage business.
A solid business plan
Many people who want to kick-start their business give up when they realise that it takes more than just a ‘lightbulb moment’ to get their business off the ground and are often surprised by the information that a lender will require to gauge the prospects of the business. Putting together a clear and sensible business plan from the outset will help you to get on the front foot. This plan should include business objectives, a strategy for reaching these objectives, potential roadblocks and market opportunities. If you are unsure how to structure your plan, take a look at the free to download templates of a business plan and cash flow forecast on the Start Up Loans website. What’s even more important is that the plan should not just be for the lender but for the business and something that is live and evolving as the business develops.
Sources of affordable funding
Raising or sourcing affordable finance is one of the main challenges that aspiring business owners face. Recent research by British Business Bank’s 2019 Small Business Finance survey shows that a third of SMEs went directly to their main bank when they needed finance, even though this route may not always be the most suitable for them or their business.
There are many sources of alternative funding specifically designed for people wanting to start their own business, including the Government-backed Start Up Loans scheme. The scheme - which is part of the British Business Bank - provides fixed-interest loans of up to £25,000 to aspiring business owners in every part of the UK, many of whom might be struggling to access other forms of finance.
The scheme exists to support and empower small business owners, whatever their background. It has lent £527 million through 66,435 loans since 2012. Of those who have received a Start Up Loan, almost four in 10 are women, more than one in 5 come from black, Asian and minority ethnic communities (BAME), and over three in 10 were unemployed when they applied for the loan.
Mentoring: getting the right advice
But it is not just about funding. We know that getting the right advice about your business can make the difference between success and failure - which is why Start Up Loans places great emphasis on mentoring and support. Through our network of delivery partners, Start Up Loans provides pre-application support with business plans and cash-flow forecasts to help you get into the best possible position to succeed. Loan recipients also receive 12-months free mentoring support. When we researched the impact of mentoring on our loan recipients earlier this year, we found a positive connection between a business owner’s participation in mentoring and their confidence, optimism and business survival.
We’re delighted that we’ve supported so many exciting businesses across the UK, from the couple in Cornwall who set up their own luxury caravan company to a woman in Brighton who set up her own maternity fitness wear to empower women to continue exercising through their pregnancies.
Others include a man in the Midlands who set up Birmingham’s first specialised table-service gin bar, which was recently named Best Gin Bar in the World; a former marine biologist from North Shields who created an online business selling products made from seaweed; and a woman from Ulster who used the funding to turn a waste ground into a wildlife centre for children.
Anyone considering setting up a business can also draw inspiration from James Dawson, a business owner from Harrogate, who used a £15,000 Start Up Loan to set up T Plus Drinks, a range of vitamin-infused healthy teas that combine the trend towards herbal teas with the growing sales of vitamin supplements.
After quitting his job in the Middle East only a few weeks after getting a promotion, James kept a close eye on UK consumer trends and quickly realised there was space for a challenger product in the traditional tea industry. Just four years after launching, T Plus Drinks is now sold in 2,000 outlets in the UK, including Whole Foods, Ocado and Boots, and James is looking to expand abroad.
PJ Farr, 31, the founder of UK Connect, is another inspirational business owner. A former soldier, he launched UK Connect in 2013 after returning from serving in The Falkland Islands, where he discovered that he got better mobile phone reception than back home in Guildford. Using the curiosity and discipline that he had developed as a soldier, PJ decided to solve the problem by taking out an £18,000 Start Up Loan and setting up his own national broadband and communications service for the construction industry. Six years later, the business has an annual turnover in the millions and a client list which includes some of the biggest names in construction.
Show your Passion
Yes, the numbers, facts and figures are important. For example, someone lending you money wants to know how they are going to be repaid but it’s also important to excite people about the opportunity, idea, product or service that you are looking to build the business around. The most interesting thing about start up businesses is the people and ideas behind them.
Find out moreStarting up and running a business can be a daunting experience but it comes with huge rewards. It’s important to remember you don’t have to face the inevitable challenges of becoming an entrepreneur alone – initiatives and support are available for those who know where to look. As a starting point, I’d encourage anyone who thinks they’ve got an idea that fills a gap in the market to check out the free advice and guides available on startuploans.co.uk.