Raising Start Up Capital

[phlp_cook]

To all,

I am a new member to the forums, currently putting together finance for a restaurant project. I have a property lined up, and around £50k of my own finance to put in. I also have staff lined up, as well as equipment orders, suppliers, and marketing lined up. I still require around 60-70k in order to purchase the current lease, and finish the required refurbishments etc. Any advice on where to be looking for investment of this nature would be great,

Thanks,

Phil

[fundingportal]

Hi Phil

It is possible that I can help with equipment leasing (always dependent on the strength of the plan, obviously)

As a general note of caution, I must say that nearly every new restaurant I see starts off back-footed because they have been over optimistic on costs, opening dates and on early revenues - this is the kiss of death to a new business.

Can I advise that you look very closely at your assumptions (particularly with regards to timings, licences etc) and make sure that you have been realistic - or indeed slightly cautious.

Mark

[fionak288]

Hi Phil, we thought this might be useful for your query.

Experian® has just launched SME Finance Finder, a free online service for SMEs designed to match their particular finance needs to the most appropriate brokers and lenders.

SME Finance Finder – the first service of its kind in the UK – allows SMEs to tap into a wide pool of potential finance options, including mortgages, invoice finance and asset finance. It saves valuable time and introduces SMEs to a range of finance options and providers that they may not have been aware of.

It enhances the chances of the application being submitted to the right provider for the right type of funding and therefore being accepted first time. It ensures the business is matched with the provider and form of finance most suited to the applicant, and that the application is completed and presented appropriately to the lender.

For more information, please visit experian.co.uk/financefinder

[davek17]

We used to be very keen on the innovation based grants and finance fields but to be honest everything seemed to dry up this year.

Banks won't lend, and it is a hard time to get funding right now. Have you tried social financing? Its apparenlty one of the fastest growing businesses in the world now and basically in a world where credit has dried up, people and businesses have started to lend to each other.

You can get funding for innovative projects or just a loan so maybe you could go down that route?

DaveK17

[Business News]

Banks won't lend, and it is a hard time to get funding right now. Have you tried social financing? Its apparenlty one of the fastest growing businesses in the world now and basically in a world where credit has dried up, people and businesses have started to lend to each other.

DaveK17

Is this based upon experience? HSBC regularly offer me overdraft and loan facilities for my company.

I think if the OP has a sound business plan that they have prepared (rather than using a cut and paste template) and demonstrable success in the industry then bank lending should be available.

Alternatively a business backer as a silent or active partner would be an option as it is a roughly 50:50 equity split required that will offer a partner/investor a decent share of the business with the possibility of a good return; assuming the venture is succesful of course.

[davek17]

We bank with HSBC, we can get £100K+ funded to us by either setting up an Invoice financing (or whatever its called) or an overdraft facility. This is not the point though...

When you see the reality of this, both are needlessly expensive, very complex to set up, very time consuming and our HSBC account manager basically started ignoring us mid-way through and still hasn't finalised the process 4 months later. We got credit through other means where we raised the same amount of credit un-secured in about 7 days.

The credit "might" be there, but the banks make you jump through so many hoops at the moment that it makes it very hard indeed. I think there's what you read on the glossy pamphlets and the reality of it when it's all totted up. For instance one of the many charges we had to pay was £600 for a guy to come to my house and my partners houses for 20 minutes and say..."Yeah it's worth about that..." to secure the finance.

Its ridiculous that people are still making money out of decent small businesses like this and its hampering the growth of the country. The whole system is rotten to the core.

We need the government and the banks to offer decently risk assessed loans to businesses, quickly and with far less cost.

At the moment all the banks are doing is inbcreasing their costs and basically using the current market to ramp up costs and draw back credit whether you're a personal or business banker. This proved by how many Bank paid employees are now becoming "Impartial" advisors under the new business replacement scheme. They're just abusing the system that is there as usual.

I don't think you can possible say its all fine, despite the banks getting all the help we hear about from the government.

[fundingportal]

BusinessNews & Davek17

Your posts are ignoring the fundamentals of the OP: It is a new start restaurant business = high risk.

Even in the days of lending hedonism these weren't easy propositions - social lending is unlikely tobe an option, neither is Angel investment at any reasonable level, as there isn't yet a business to invest in.

As to availability of bank funding - yes, banks will lend, cautiously, where they have a lot of confidence in the business. It costs more than it used to because the banks finally worked out that in their stampeed for the bottom they were losing money.

Higher borrowing costs will be here for a considerable time. Government interference )(other than by tidying up the EFG loan) will be disastrous and a huge waste of taxpayer's money as they have precisely no business credetials orexperience in the field.

Over all, btw - I do see peer-to-peer lending as a very efficient product and would recommend it.

[JamesCartwright]

We recently produced an article on funding after company formation (http://www.wisteriaformations.co.uk/articles/index.php/start-up-funding-for-entrepreneurs/) on our website. I've posted it on here a couple of times, because if nothing else, it might help to stimulate some ideas and thoughts you hadn't previously thought about!

Hope it at least stirs some ideas anyway! :)

[Ian J]

We recently produced an article on funding after company formation on our website. I've posted it on here a couple of times, because if nothing else, it might help to stimulate some ideas and thoughts you hadn't previously thought about!

And Google has another link to spider :)

Your article is completely irrelevant to the OP's question as he seems to know what he needs but wants advice on where to get it from.

May I suggest using the services of a good finance broker (and before you ask I don't deal in that sort of funding) as they should know what's available and what isn't

[SB100]

Slightly off topic, but might a turnkey opportunity be of interest?

We currently have a client in Berkshire, a Quality Independent Restaurant, looking for a buy-in;

It represents the perfect opportunity for a restaurateur or their backer for a minimal sum to take control of an established business with excellent profit prospects.



Drop me a message if you'd like further info.
Regards
Simon