You have a fantastic company concept, but can you get the money to handle your finances as you expand?
Any small firm that wants to develop and grow must be able to get financing.
It may be difficult to tell which product will be the greatest match for your specific company at any given moment, much alone how to manage your funds to increase the likelihood that your application will be approved.
Here are seven crucial suggestions to help your company get the funding it needs to prosper and expand.
1. Plan, review, and plan again
Lack of a solid business strategy is one of the main causes of companies failing. A crucial first step in building a strong foundation is a plan that outlines your company’s strategy and clarifies what problem your company is seeking to address.
Your strategy should lay out your goals, your selling proposition, the abilities you already possess, and those you will need to achieve your objectives. You can identify any possible flaws or concerns within the planning phase itself.
2. Metrics matter
Measuring your performance and development is crucial once you’ve set your goals and objectives. You really can’t have enough information about your company. Setting SMART, or specific, measurable, attainable, realistic, and time-bound, goals that you can evaluate often might be useful.
There are many resources and tools available to aid with your information gathering. Award-winning business banking software HSBC Kinetic* uses data to educate users about possible dangers to their businesses and provide solutions. It works in conjunction with various proprietary applications to provide you with a complete view of company performance. That data may support growth by assisting in identifying trends, risks, and opportunities.
3. Mind the gaps
You can find gaps in your cash and trade cycles that can limit growth using your trading expertise and financial analytics. Your funds may be locked up, for instance, if a customer’s payment is delayed or items are delayed in shipping.
You can maintain track of your money, which is important while expanding, by reassessing trade cycles and your current terms. Additionally, it may clarify what adjustments might hasten your growth and if you could want money to carry out your ambitions.
When you need money, HSBC Kinetic* offers a Small Business Loan** so you can get it quickly and keep up with the expansion rate.
4. Be truthful.
It’s crucial to be upfront and honest about your demands, the intended use of the funds, and the method used to determine the amount needed while looking for finance for your company.
Good financial records might be helpful in this situation. They may demonstrate your trading history, how risk is handled, and your dedication, all of which are factors that lenders and investors will pay close attention to.
5. Recognize your choices.
It may be challenging for startups to get loan financing; as a result, many resorts to family and friends. The alternatives might be confusing regarding funding development, especially when you have financial data and proof of concept.
It is crucial to comprehend the conditions of each alternative and how they might affect your company. For instance, angel investors and venture capitalists (VCs) may provide cash, expertise, and assistance. Still, they also want an ownership interest in exchange, and many company owners are unwilling to give that up.
Debt financing also comes in various ways, especially as your firm grows. Working capital might be freed up by using more structured solutions like trade financing, which bridges the payment gap between your suppliers and your regular point of sale, or receivables finance, which raises money against your issued sales invoices.
6. Cash flow is supreme.
Knowing your cash flow inside and out is essential if you want your firm to endure and grow.
Make sure you budget enough money to still fulfill your responsibilities if anything goes wrong like you lose a contract or your projections are inaccurate. How you can reduce risk and pay off any debt is one of the first things any financial provider will consider. You may better manage your company’s finances with the HSBC Kinetic Current Accountuseful *’s cash flow forecasts.
7. Get assistance
Businesses don’t run in a vacuum, and your network may assist you not just obtain specialized support but also in discovering new possibilities and markets that can help you grow up. Growing your firm requires developing that support both inside and internationally. To take your idea and learn everything you don’t know, such as IT, marketing, supply chains, or finance, is a steep learning curve.
You can apply for a new business account in minutes with HSBC Kinetic. So if you’re a single director shareholder limited company or a sole trader, find out more at business.hsbc.uk/kinetic
Simply download the HSBC Kinetic app and apply in minutes. Most accounts are opened in 48 hours.
*HSBC Kinetic is subject to eligibility, T&Cs, credit check and fees apply.
**You don’t have to open, have or maintain a HSBC Kinetic Current Account to open, have or maintain a HSBC Kinetic Small Business Loan.
This article was written as part of a paid-for advertising content campaign with HSBC.