There are three main ways to raise small business finance – “friends, family and fools”, a small business advisory service has said.
Eastside Consulting has asserted that the three Fs are “100 per cent” the first places that entrepreneurs look to for money when they are planning to launch a new company. Managing director Richard Litchfield also noted that banks and government grants can also be helpful and should be investigated, while another common source of cash are ‘Business angels, wealthy individuals who are willing to invest in a startup. He said: “The first place to go is FFF: that’s friends, family and fools… If people have either savings, or family and friends with a bit of capital that will back them, then that’s 100 per cent the most common way to start any business. “Beyond that there is a wide range of different sources of finance, and different agencies to assist people raise the finance. Loan finance is perhaps the most obvious and people should start by visiting their local bank.” In its Financial Stability Report, released on October 24th, the Bank of England warned that following the credit squeeze on global markets “banks are likely to make some changes to their business models” and that “the financial system in the United Kingdom and elsewhere is vulnerable to further shocks”. © Adfero Ltd
