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Where Can I Find Startup Funding? - Fleximize

Where Can I Find Start-up Funding?

We take a look at how UK startups can access the business funding they need to grow and thrive

By Kate Josselyn

Starting a business can be challenging, especially when it comes to finding the right funding. Luckily, there are lots of options for small businesses in the UK to get the financial support they need to grow and thrive.

With help from the government, online lenders, and other resources, start-ups can access funding more easily than ever. Here's a breakdown of where you can find start-up funding, including small business grants and loans.

Government schemes

The UK government offers various funding options for small businesses, including grants and loans. These can help cover costs like equipment, hiring staff, or marketing. However, it's important to understand the differences between grants and loans.

Small business grants

Small business grants are financial awards that do not need to be repaid. These grants are often location-specific and may have specific eligibility criteria. To apply, businesses typically need to:

To apply for small business grants in the UK, you’ll need to check eligibility criteria, which often includes being a registered UK business and having a clear plan for how the grant will be used. Each grant will have different requirements, so it’s important to do your research to find the best fit for your start-up.

Since UK business grants are highly competitive, start-ups may need to apply for multiple programs before securing funding.

Start Up Loans Scheme

A key government-backed loan option is the Start Up Loans scheme, which provides funding to help new businesses get off the ground. This program has already lent over £600 million to support 75,000 businesses in the UK. Key features include:

While Start Up Loans require repayment, they come with valuable support to help new businesses succeed.

Loans from not-for-profit lenders

If government loans or start-up business grants UK don’t quite fit your needs, you might want to check out not-for-profit lenders. These organisations are set up to help new businesses succeed by offering accessible loans. A popular example of this is Virgin Startup.

Virgin StartUp provides loans of up to £25,000 and, just like with the Start Up Loans scheme, you’ll be paired with a mentor who will support you through the application process and beyond. This one-on-one guidance can help you figure out what’s needed to apply for the loan, and give you advice on how to grow your business once you receive the funds.

Crowdfunding

Crowdfunding has become a popular way for start-ups to raise money. Instead of borrowing from one lender or getting funding from a single investor, crowdfunding allows you to raise small amounts of money from many people. There are websites, like Kickstarter or Indiegogo, where businesses can post their project, explain how much money they need, and offer rewards to those who invest.

With crowdfunding, even small donations can add up. For example, if 1,000 people each donate £10, you’ve already raised £10,000! This method allows start-ups to raise the money they need while also building a community of people who are interested in the product or service they’re offering.

However, it's important to remember that crowdfunding platforms, especially reward-based platforms like Kickstarter, require you to give something in return for the funding. This could be anything from a product sample to exclusive access to a new service. Other platforms, like equity crowdfunding, allow people to invest in your business in exchange for shares.

Peer-to-peer lending

Peer-to-peer lending is similar to crowdfunding but works a little differently. Instead of investors giving money in exchange for rewards or shares, peer-to-peer lending involves multiple investors pooling their money into an online platform that provides loans to small businesses.

Once you submit your application, peer-to-peer lenders review it, do credit checks, and decide if they will offer a loan. The process can be faster than traditional loans, with some platforms giving decisions within 24 hours. If approved, your loan is posted on their site, and multiple investors can fund your loan. Once your goal is reached, the money is released, and you start making monthly payments.

Peer-to-peer lending is a flexible option for small business funding, allowing you to borrow smaller amounts and often with more relaxed terms compared to traditional bank loans.

Angel investors

Another way to fund your start-up is through angel investors. Angel investors are individuals who use their personal money to invest in new businesses, often in exchange for equity in the company. Angel investors can be high-net-worth individuals, but they could also be friends or family members who believe in your business idea and want to help you succeed.

Angel investors are typically looking for businesses with strong growth potential, and they often provide more than just money. Many angel investors are experienced business people who can offer valuable advice and connections to help your business grow.

The amount of money an angel investor provides can vary greatly, depending on how much they’re willing to invest and how much equity they want in return. This makes it a flexible option for start-ups looking for both funding and strategic support.

Looking ahead

Once your business has been running for a while, typically six months or more, you’ll find that there are even more options for small business funding. Many lenders, including online lenders like Fleximize, offer specific products for businesses in their growth phase.

For example, Fleximize offers loans ranging from £10,000 to £500,000, with flexible features like repayment holidays and no early repayment fees. These types of loans are perfect for businesses that need a bit more capital to continue expanding. Unlike the more limited options available to start-ups, these growth loans offer higher amounts and more flexibility.

Your common questions answered

To get funding for a start-up, you can explore several options.

You might apply for start-up loans, look into small business grants UK, or consider crowdfunding.

You can also reach out to angel investors or use peer-to-peer lending platforms.

Each option offers different levels of support, depending on your business needs.

People fund their startups through different methods like loans from the government or not-for-profit lenders, crowdfunding, and grants for small businesses.

Others may use their savings or ask for support from angel investors who provide money in exchange for a stake in the company.

The best type of funding depends on your specific needs.

If you want funding without giving up ownership, start-up business grants UK or small business grants are great.

If you’re okay with paying the money back, a start-up loan may work better.

For more flexibility, peer-to-peer lending and crowdfunding can also be good options.

To fund a startup in the UK, you can apply for government programs like the Start Up Loans scheme or look into new business grants.

You can also seek small business funding from online lenders, try crowdfunding, or get support from angel investors.

Starting a business with no money can be tough, but it’s possible!

You could look for business grants UK that don’t need to be repaid, partner with someone who can invest, or use free tools and resources. You might also consider starting small, offering services with minimal upfront costs.

Yes, you can get small business grants to start a company.

Many of these grants are offered by the government, local authorities, or private organisations.

They can help cover initial costs like equipment or marketing, and the best part is, grants for small businesses don’t need to be repaid.

Getting startup funding can be challenging, but there are many resources available in the UK. You’ll need a solid business plan and proof that your idea has potential.

Some funding options, like crowdfunding, may be easier than others, while small business grants can be competitive.

Yes, startups in the UK need to pay taxes.

Once your business is set up, you’ll need to register with HMRC and pay taxes based on your profits. This includes corporation tax, as well as VAT if you meet the earnings threshold.

Buying a business with no money can be difficult but not impossible.

You might use seller financing, where the current owner agrees to let you pay in instalments. Alternatively, you could partner with an investor or look for grants and loans to help cover the cost.

While many businesses need some amount of money to start, it’s possible to start small without much funding.

You can use free resources, apply for new business grants, or start with a low-cost business model, such as offering services or selling digital products.

The cost to start a business in the UK can vary widely, depending on your industry and needs.

Some businesses might start with just a few hundred pounds, while others may need thousands. You can keep costs low by applying for small business funding or using start-up business grants UK to help cover initial expenses.

Yes, you can get plenty of help! The UK government offers programs like the Start Up Loans scheme, and there are many organisations that provide support for new businesses, including business grants UK, mentoring, and advice on how to get started.

You can also seek help from angel investors or look for start-up business grants UK to help you grow your business.

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