The Scottish Investment Bank has a team of experienced financial readiness specialists, who work with businesses to help them prepare to secure funding.
Head of SIB's Financial Readiness team, Jan Robertson, explains the importance of businesses developing a robust strategy for attracting finance, and how SIB is helping businesses achieve this.
Q What does being 'financially ready' mean and how can businesses achieve this?
A It's about making sure your business is in the best possible shape to secure the growth funding it needs. Funding remains a scarce resource at present so businesses need to ensure that they have the best funding proposition possible. To be financially ready businesses need to ensure that they have objectively reviewed their business plan and funding proposition, have identified their funding need and have fully considered the requirements of potential funders.
Q How do you know what types of funding or investment options are best for each individual business and how is this decision reached?
A It's a matter of working closely with each business to understand their growth plans. We need to consider the growth and risk stage of the business; the amount of funding it's looking for and for how long; how the funding will be spent and how it intends to repay debt - if that's applicable - and what its future projections and future funding needs are. For an equity investment we would talk through the typical equity investment process and terms, what support the business might be looking for from an equity investor, as well as investor return and exit expectations. Once we've built up a complete picture, we can identify the type of funding most likely to meet needs of the business.
Q What is the best piece of advice you can give businesses that are anxious to grow?
A Don't run before you can walk. Make sure you're ready for growth and that you've thought about the longer term as well as the immediate future. Get a robust business plan in place and be realistic about what you can expect to achieve and about the timescales you hope to achieve it in. Above all, get expert advice. There are a lot of excellent sources of information out there as well as Scottish Enterprise so don't think you have to do it alone.
l The Scottish Investment Bank supports the development of Scotland's private sector funding market to ensure that both early stage and established SMEs with growth and export potential have adequate access to growth capital.
SIB operates a suite of investment funds: the Scottish Seed Fund, the Scottish Co-investment Fund and the Scottish Venture Fund, both of which are partly funded by the European Regional Development Fund (ERDF); the Scottish Plastics Loan Fund and the Renewable Energy Investment Fund.
They are also the lead investor in the privately-managed Scottish Loan Fund and an investor in the Rock Spring Ventures EU LLP life sciences fund.
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