During the lifetime of your company, you may eventually reach a point where you wish to elevate your service offering and expand your business to attract a new bracket of consumers and increase your chances of boosting profits. As the company director, you may conduct a small renovation of business operations to prepare for the next phase of your journey, taking into serious consideration the options available to you to grow your company and increase market value.
The route you take will depend on the end goal you wish to achieve and whether the growth of your business is likely to be pursued organically or non-organically. Organic growth refers to the natural development of your company, such as through word of mouth marketing, partnerships with suppliers and the integration of smarter technology. Non-organic growth refers to artificially engineering company growth by bolstering business activity through a merger or acquisition.
By scoring company goals, such as recruiting more staff and purchasing rights to industry-specific software, you can help the business grow at a steady pace. To achieve this goal, you may need to embark on a funding exercise to raise money. By taking the merger or acquisition approach, you can automatically inherit market share and company assets which can instantly boost your position in the marketplace, leading to company growth at a rapid pace. We take you through the funding options available to you to grow your company.
Private equity firms and investors
Private equity firms invest in companies with the view to generate a return by holding a stake in the business. There are many types of investors which can bring more than funds to the table, such as mentorship, industry connections, office premises, equipment access, etc. For example, Angel Investors are high-net-worth individuals who typically provide funding to start-ups and innovative young businesses for a stake in the company in return. Angel Investors may also provide mentorship, incubator and accelerator services to your business, guiding you throughout the company growth process.
You may turn to commercial finance to access a finance option suitable to your needs, such as invoice finance or asset finance. This form of finance can be tailored to individual uses and help improve cash flow, such as purchasing industrial equipment or to bridge the income gap between invoice payments. Commercial finance can help you meet the financial needs of your business and strip away any restrictions which may limit growth. Accessing funds through this route may prove to be faster and more effective than turning to a traditional bank loan with tighter terms and non-competitive rates.
Depending on the location of your business, you may be eligible for an enterprise grant to help your business deliver projects and purchase equipment/assets necessary to facilitate company growth. The grant amount available to you may depend on targets to create job roles over the long-term and forecasted productivity. Your local authority may offer a funding scheme for growing businesses to help increase local employment rates and bolster contributions to the local economy. You may find a range of industry-specific grant and loans schemes, in addition to financial support on offer from innovative business institutions.
There are many ways you may be able to access funding, other than through traditional methods, such as a bank loan. As online lenders offer accessible products and crowdfunding platforms can be attributed to the rapid success of the UK’s fastest-growing business, the finance options available to businesses are vast. Equity financing is another route which consists of selling shares in the business which may be an accessible and favourable option for larger businesses. Although this route may provide fast results, a serious drawback is having to relinquish control.
By seeking growth capital to secure a profitable future for your company, your business can perform with limited restrictions on capital. If your company has the potential to reach new heights, your borrowing can be easily compensated for and the finance can be used to secure higher value contracts. The route you take will be determined by the level of risk your business can endure and the growth potential. Turning to a finance broker, financial advisor or commercial finance lender can help determine the route suitable for your company.