As everyone knows, after the financial disaster of 2008 traditional banks became a lot stricter with their lending, and rightly so. However, with this, a gap in the market was created. Where real, established and well-meaning businesses found it increasingly difficult to raise working capital.

Businesses where met with ‘no’s’ because their industry was deemed “too risky”, even those who’re established and profitable for 5 or more years. Other times, banks would glance at a businesses credit ratings and either make raising capital too expensive, ask for charges, or deny their request.

Naturally, this has made many business owners angry at the lack of a commonsense approach to lending capital. So they can grow their business, hire more employees and help our economy grow as a direct result.

With this problem, a new, and arguably better solution to raising working capital has flourished. Known to many as the alternative lending market or quite simply financial brokers. With this includes the rise of bespoke business finance and loans.

With this problem, a new, and arguably better solution to raising working capital has flourished. Known to many as the alternative lending market or quite simply financial brokers. With this includes the rise of bespoke business finance and loans.

So what is bespoke business finance?

Bespoke business finance is different from a regular finance solution. It’s the process of not selling an “off the shelf” finance product. But instead, consulting with a business, finding out why they need the capital and what their businesses objectives are. This information is then used to structure a financial agreement more inline with their objectives and challenges.

Think of it as a “build your own policy”. Do you need to lend money for a short amount of time? Well, we can help you with that. Do you need to raise a substantial amount of capital without applying a charge over your business? Well, we could help you with that also.

Now, this is achievable thanks to the way financial brokers operate. As we have access to multiple lenders, from private investors to overseas tier 1 banks. This gives us the leverage and buying power to structure an agreement that fits your businesses goals.

Instead of relying on the big four banks in the UK for all of your finance needs. We open up a world with access to hundreds of lenders with competitive prices. These include industry specific lenders - those who specialise in working exclusively with your industry only.

With that, you could expect to see better rates and terms, now that you’re working with a lender who understands your industry. Rather than working with a lender who only understands your credit rating and skims over your balance sheet.

What products are available with bespoke business finance?

Again, there are no set products. It’s a process of explaining to us why you need capital and for us to suggest a financial vehicle to achieve your objective. But, to illustrate further, here are some of the more common products we provide:

Asset finance - buy or refinance assets your company needs

Asset finance can be used to raise working capital from existing assets you own. Or you can simply choose to buy new assets with this type of finance. Often this can include some soft costs too (training, installation, servicing etc)

Now there are many different types of asset finance that work for different objectives. But most variations help you to either buy a new asset, rent a new asset, or refinance an asset. Ultimately this type of finance is most commonly used to buy assets for your business. But is often used to raise working capital in challenging lending circumstances.

Unsecured & secured business loans - raise working capital

This is our most requested product, but mainly because businesses aren’t aware of the other financial products available to them. Loans are either secured with a charge over a business or unsecured with no charge over a business.

The benefits of having a secured loan are that it’s relatively easy and fast to ask for more capital in the future. However, many business owners feel uneasy placing a charge over their business and opt for the slightly more expensive unsecured loan.

Both loans serve the same function of raising capital for a business to utilise in their own way. This could be to purchase stock, hire more employees or buy assets.

Peer to peer financing - raise capital by using private investors

P2P lending uses technology to allow single or multiple investors to pool their money together to structure a loan. There tends to be a lot more flexibility in the agreements of said loan. Allowing you to design the structure on your terms and leaving it to the market to decide if they want to finance your loan.

This could include the likes of secured, unsecured and even private equity agreements. With private equity, you would, of course, have to sell your shares in exchange for the working capital. The agreements can have buyout clauses or it could be an ongoing agreement.

By using P2P finance you have access to a range of global investors who will turn a blind eye to credit ratings. Taking more importance from your business's story and its future objective. This can make securing finance a lot easier than traditional lending.

Invoice factoring & discounting - raise money against specific or all unpaid invoices

This type of finance uses existing invoices and future invoices to raise capital against. This is particularly useful for businesses with high debtor days. Using this type of agreement the funder will pay you a percentage of the unpaid invoice while collecting the full value themselves.

This is particularly useful on the basis of just increasing cash flow. This helps to pay employees and contractors for their work without the need to leverage debt to keep your business afloat.

Why would you get a bespoke business loan?

The nature of bespoke business loans allows them to be incredibly versatile. Through consultation with Financial Brokers, you could combine two or more financial vehicles to raise the capital you need.

The reason for this differs from business to business. Sometimes it’s due to how you want an asset class to be treated on your balance sheet. Other times it’s because you need short term and long term finance.

For the more complex deals, it may be because you require a large amount of finance but banks have previously turned you away or offered you a loan far too small for your needs. However, with our knowledge, and contacts, we could synergise a loan from multiple lenders to raise the capital you require.

And to further this point, it could even be because your operation isn’t strictly UK based and you need to raise finance for your company's subsidiaries in different countries. Yet, banks feel uncomfortable lending money overseas.

Ultimately, there are many reasons why you may want a bespoke business loan, far too many to list here. However, should you have a business project that needs financing, or requires counsel on how to finance your loan, as always it’s best to call us directly today. We will provide you with free initial advice and outlay a number of hidden solutions you may not have considered.