Start Up Loans Business Women

The Best Start Up Business Loan

What Do I Need to Get A Start Up Business Loan?

When looking for a start-up business loan there is fundamental information that you need to have so you qualify for the loan. Commonly businesses approach Pinnacle looking for start-up investment with little to no information. We understand that when starting your new exciting venture, there is plenty to get organised. Having the financial backing to set your dream alight it crucial. Correctly, you first may have identified using a business loan is better than investing all your life savings. So how do you get a business loan? The first thing you need Is a sound business plan.

A plan that illustrates what the business does, why it will be successful, what you are looking to invest in, and a clear cash-flow projection. This is pivotal. Without this, would you invest in someone else’s businesses not knowing anything about it? Of course, you wouldn’t. So, having your business plan ready to go, demonstrates that you are well prepared. Secondly having your business bank account set up is again an absolute must. This shows to the lender that you have a place for them to release the funds into. Plus, you have passed relevant AML (anti-money laundering) checks with your business bank provider. Once you have these 2 pieces of information readily available then approach a business finance broker.


Poor Credit Business Loans

Business owners looking for a business loan don’t always have the luxury of having excellent credit scores. This may be showing as poor credit. For several different factors that are historic and out of your control. However, every financier will do a credit check. But don’t panic if your credit score isn’t great. Having the full picture of why your credit score may be below ‘average’ is where we can help. Knowing what happened and having actions to mitigate against any further risks and how you can improve your credit score is positive. Alternative finance lenders can be flexible in their approach and accommodate a wide variety of businesses and business owners.

So, don’t think just because your personal credit score is low then you won’t qualify for a business loan. There are many options and having the whole of the finance market available to you through a finance broker like ourselves is crucial. Whether you have good credit scores or not so.


How Much Does A Start Up Loan Cost?

Running a new start business and keeping overheads as low as possible is a key variable. Whilst keeping cash-flow strong can be difficult. So, when investing at the start having the financial backing to grow your business highly important. The question of how much do business loans cost is common. For good reason. The answer is all dependent on the individual business owner or owners’ circumstances. No two businesses are the same.

If you are a homeowner, excellent credit, and well experienced within the business sector then this will carry lower interest rates. Rates of circa 3%-7% per annum. If you are a non-homeowner, poor credit and no experience with little to no business plan interest rates will rise. You can start to see why having a business plan is so fundamental. Especially when a human underwriter is assessing your application. Installing the confidence in the finance company to invest in your business.

Looking to Apply For A Start Up Business Loan?

Hopefully, after reading the above you start to get a feel for what is required to secure a start-up business loan. What information will be assessed and commonly not just the funding is put in place but a business mentor to help you grow your business. It’s in the business finance company interest to support and grow your business. The better and quicker your business grows the fewer risks and potentially quicker you can repay the funds. Having a finance broker in your corner to grow and source the best business loan for you will save you time and money.

The 2 most important factors within business. At Pinnacle we know that every business has to start somewhere. You may have the best vision of your business but unsure where to start with business finance. We have helped countless businesses of all sizes secure funding. Not just corporate and SME finance but new start funding!

Cash Flow Invoice Finance

How to Boost Cash Flow?

What Is Cash Flow

Before we delve into the fine art of cash flow and how this can grow your business, we need to understand what cash-flow is. Commonly within a business, your accountant, consultant, or support network may commonly mention cash-flow to you and how important this is. The reason being is that it’s the lifeblood of any business. So, cash-flow is the transferring of capital in and out of a business. Think of it as water running through the pipes and out a tap. Without cash-flow, you may have all the infrastructure but no capital available to you. A business can be loss-making but have healthy cash-flow. Therefore, not feel the impact of this. Now of course the aim of any business owner is to be profitable, have readily available funds, and have the ability to scale the business to achieve the desired outcome.


How to Assess Cash Flow?

When looking for investment into a business the financier or lender will analyse the business’s cash flow position. The way in which most financiers will do this is by looking at the debt servicing ratio. This is a simple equation as follows. Debt Service Coverage Ratio = Net Operating Income / Short-Term Debt Obligations. This is to make sure that the business can repay the short term borrowing or liabilities to creditors etc. Your business can be profitable but if it doesn’t have positive cash-flow then it won’t survive. The reason why this can happen is you have large amounts of capital tied up in outstanding invoices. If credit terms to customers are less than favorable, then how will you support have readily available funds? How will you pay staff, buy further stock or have free capital to grow your business?


How Do My Credit Terms Effect My Cash Flow?

When starting a business or scaling an SME business up, how do you maintain a positive cash flow position within your business? One of the many tools in your armory is to get your customers to pay within the credit terms. On the flip side, ask your suppliers to offer credit terms to you. As a consequence of this, you will not only have the ability to pay your suppliers in 30 or even 60 days’ time after the goods or serviced have been supplied. You will have your customers paying you in a timely fashion. This will leave you free money to operate your business. Maintaining a healthy cash flow position and be able to grow or acquire business’s as you go.


Finance Solutions Available 

Now as a business owner, financial director, or business advisor you are thinking I want to grow my business. How do I improve my cash-flow; in partnership with the points already raised? One finance solution to support cash-flow is invoice finance. This is accessible to all sizes of business not just corporate finance. As a start-up or SME business, it can be difficult to access funding. Invoice finance is there for a business who invoices B2B (Business to Business) once the goods or service has been delivered. Often smaller companies are put under greater strain when working for larger businesses.

This is because the credit terms for paying invoices can be 60, 90, or even 120 days after the work was completed. Leaving you the business owner with outstanding invoices on your sales ledger. Now invoice finance can release the outstanding money on your sales ledger and give you the ability to not only free trade with the larger businesses. But grow your business and have a positive position. The amount you have tied up in outstanding invoices plus future invoices you raise will be advanced against.


How To Access Finance?

The answer is simple. Go to either ourselves Pinnacle Business Finance as we have a wealth of experience within this industry. Alternatively, you can go to your accountant or business consultant who will refer you to a commercial finance broker such as ourselves to source finance for you. This will not only save you time, money and give you the ability to gain the financial backing you require.

Business Loans

How Do I Apply For A Business Loan?

What is a small business loan?

When starting a business, commonly the first form of commercial finance owners think of is a business loan. This is because it’s the most popular form of business finance. But how do you go about securing a small business loan? A finance broker is a great place to start as they have the whole of the market available to them. Here at Pinnacle, we have over 70 different financiers on our panel.

Since 2008 a wealth of alternative finance providers has developed in the market. All having a unique and individual finance offering. Start-up businesses can look for grants, angel investment, or private equity but, this can be extremely time-consuming. A case of ‘’not what you know but who you know’’. Therefore, many doors can be closed before even getting started. Having a clear business plan, cash flow projection for 12 -24months in crucial. It will remove the stress from starting the business. Keep you focused on your monthly goals. In addition, doing a thorough SWOT (Strength, Weakness, Opportunities, Threats) is vital. That could be doing test trading of the market you are looking to enter before you commit. It gives you a clear indication of the challenges you will face and how to overcome these. Once you have this in place and are ready to look for a start-up business loan then have these documents ready. It allows the commercial finance broker to quickly access the lender’s criteria and gather quotes for you.


How do small business loans work?

There are 2 forms of business loans. A secured loan often allows for a higher funding amount, above £300,000. Or an un-secured loan of between £500-£300,000 for non-homeowners. Due to the nature of it being un-secured, this will commonly carry a higher interest rate but lower risk to the business borrowing. The term of the loan can again fluctuate between 1 month up to 5 years depending on the circumstance. A revolving credit facility offers a line of credit whereby you can borrow as much or little as you like. Limiting the risk for the financier and the business borrowing a loan. As you can start to see, times have changed. No longer does a start-up business looking for a loan have to commit for a lengthy-term with rigid guidelines. Once you have a loan provider who agrees to lend the required amount, a monthly interest rate will be applied. Some loan providers will charge this on a daily rate making it easy to manage. Others and more commonly on a monthly basis. Having the flexibility of no early repayments, being able to borrow more when you require should be considerations. This is where a finance expert at Pinnacle Business Finance will explain to you how the business loan will work for you. Saving you time and money!


How do you qualify for a business loan?

When applying for a business loan the first critical step is to make sure you have the information previously mentioned in order. This includes a business plan, cash-flow forecast for a minimum of 12 months, a business bank account set up, and any statements if you have started to trade. Finally, a solid structure of where you are taking the business over the next 12 months. This will demonstrate to the financier that you are serious about growing your business. You have a clear vision of what you are looking to achieve, and you have taken the first necessary steps. If you have a finance broker, they can help you gather this information, approach the relevant financiers and obtain the quotes for you. Leave this to the finance experts as you can go down the wrong avenue if you are not careful. It can be a fast finance options and set up in as little as 24 hours. Making a business loan quick and efficient.


How much can you borrow for a small or start-up business loan?

This is a question that gets raised a lot to us at Pinnacle. This is for a good reason. You want to know how much you can borrow from a loan and how long will it take to get set up. The answer is for a new start business up to £25,000 in one lump sum is the most frequent amount. You will be able to access further funding in the future as the business grows and cash flow improves. Again, if you look at the secured loan option then yes, the funding amount can be much larger. You have to decide whether the risk against the reward is sufficient. If the answer is yes and you have the required information, then there are finance options available to you. The term of the loan can be up to 5 years but commonly 12 months is sufficient. You have to work out how much business finance do I need now? Then once you have put this into your business plan and cash flow forecast approach a finance broker such as Pinnacle Business Finance.


How Can Pinnacle Business Finance Secure A Start-Up Loan For You?

Our funding experts will sit down with you and obtain the funding for you. You can carry on working on other areas of the business and we will take the stress away for you. The first step is to fill out an enquiry form on the website or simply give us a call. One of the team will talk through the next steps to securing a business loan for you. You can manage the process through your online login which gives you access to your own account. It will prompt you when you need to upload information. Allowing you to check on how your loan application is progressing. This is one of the many unique areas the Pinnacle team has. If you would like to start your funding journey then get in touch today.

The World Famous Clifton Suspension Bridge, situated in Bristol, UK.

What Is a Commercial Finance Broker?

What is the job of a commercial finance broker?

A commercial finance broker has an extremely important role in business finance in the UK. A finance broker should compare the market, saving you time and money with no preference to a single lender. They should be there to support and guide you through the process, answering any question you may have. Since the credit crunch of 2008, a wealth of alternative lenders have been there offering something different to high street banks.

Pinnacle Business Finance is experienced within invoice finance and business loans. Not only as a broker but as a lender too. This is because the team has worked within these sectors for financiers so understand the market requirements. The Pinnacle team will guide you through your funding journey.

 Why should I use a commercial finance broker?

This is a question that has been raised in the past. Would you try and build a house with no experience or knowledge of building? You have a business to run which is time-consuming in itself. Let alone having to go to the market and hoping that you strike lucky with a lender. Then not knowing if you have the most appropriate funding in place for your business. Comparing your funding options is crucial and a business finance broker will do this for you adding value along your funding journey.

Pinnacle Business Finance is rated 5 stars on Google. Evidencing the importance we put on customer service. We have a panel of over 70 lenders all bringing their own unique view on commercial finance and the funding facilities they can offer. We can negotiate on your behalf. Were there to support you to make sure you understand how the finance facility will work.


Where do I find a commercial finance broker?

You may have gone to your accountant looking to raise commercial finance. You might have been referred to a finance broker. Then again you can go online or ask for recommendations from another business owner you trust to see if they have used a finance broker in the past. There are many different places you can find a finance broker but getting the right one is crucial. Some brokers may specialise in 1 certain product as others have a broader more experienced role and have a greater product offering.

Pinnacle can source a wide range of commercial finance offerings for business’s not just invoice finance and commercial loans. This may include merchant cash advance, asset finance, or a commercial mortgage. Pinnacle finance has various case studies, google reviews, and testimonials which evidences our ability to get the job done at the highest standard.


How can a business finance broker help my business grow?

If you are SME business or new start business looking to grow and invest then a commercial finance broker can help. The reason why is because they not only will source the most appropriate funding for your business, they can tailor it to fit your needs. A good finance broker will demonstrate their experience and knowledge within the sector. Giving you the confidence that investing in your business is the right or wrong option at that given time.

Pinnacle sources commercial finance for you and will make sure you are happy with the funding offer. Frequently offering multiple funding options to you letting you decide on how you would like to proceed. Getting the commercial finance in place is vital to the success of your business. If you would like to find out more about how Pinnacle can make your business grow with commercial finance, then get in touch to claim your free consultation with a funding expert.

Finance word on square wooden blocks on a wooden background

How To Compare Commercial Finance

Commercial finance can be a fantastic way of finding financial aid or solutions which are specifically designed for your business. Specific commercial finance deals could mean better rates, with features aimed at making the running of your business easier. Read our latest guide on commercial finance and what options there are.

What is commercial finance?

First off you may be thinking ‘I run a business and I’m looking to grow’. You will want to invest in your business but may be left wondering what actually is commercial finance? It’s quite simple and the answer is it’s a collective term used to summarise investment and financial offerings available exclusively to businesses. It’s not private or personal investment, which is very different.

Who can access commercial finance?

A commercial finance broker is a good place to start when looking to access commercial finance. The reason being is that they have the whole of the market available to them and this allows you to compare business finance options.

In addition, you have the whole of the market available to you. You can then select the financier who is right for you and have the benefit of the finance broker knowledge. This is key to getting the most suitable finance solution for your business.

What commercial finance options are there?

Examples of commercial finance are invoice finance, business loans, asset finance and merchant cash advance. All of these finance solutions bring their own unique funding angle to a business. If you are involved in the healthcare sector, recruitment, or haulage industry then notoriously customers are slow at paying for the service or goods you have provided. So how do you mitigate this and boost cash flow? Invoice finance is a solution that assists with cash flow and allow you to grow. It can be a selective invoice facility or whole turnover depending on how your business operates. Furthermore, if you take a lot of card payments such as shops, pubs, hospitality, and hotels then merchant cash advance can be a way of borrowing funds against your card terminal. Let’s say you take £20,000 then the financier will repay back the loan as a percentage of the card transactions. It’s a very quick and easy finance solution to get set up with a clear fee structure.

What are the pros and cons of commercial finance?

This is a question that gets raised a lot by business owners and rightfully so. This is because how do you know that the investment is right for you? Having a business plan and structure of where you want to be in 12-24 months’ time allows you to plan ahead, which is the first step. If you have this, then get in touch with a finance broker and do your research.

The commercial finance broker will look at past and future projections and discuss what you are looking to achieve with the business funding. Have information to hand such as bank statements, business plan, annual accounts if applicable, and a clear vision of how you are going to use the finance to achieve your business goal. This will allow the finance broker to assess your business and compare the funding solutions available.

Once you have funding options ask questions about how the facility will work and decide if this is suitable for you. You know your business better than anyone else, so you need to make the decision on the most appropriate funding solution.

Where can I get a commercial loan?

One of the most common forms of commercial finance is a business loan. This is because most people think of a commercial loan when they envision investing in their business.

With the rise of alternative business funding in the marketplace since 2008, there is a wide array of un-secured and secured loan providers. They each again bring a different proposition in relation to rates, funding terms, and flexibility. The good news is, if you are a non-homeowner that needs a loan then still there are many lenders for you.

A commercial finance broker will source a business loan. Here at Pinnacle as a broker in Bristol, business loans are a specialist field for us. We have funding specialists which will explain clearly and thoroughly how the business loan will operate and the pros and cons of each offer. Hopefully, after reading this you feel more confident in what commercial finance is and how you can access it.

Get in touch with Pinnacle Business Finance Today

We hope that our guide to commercial finance and the options available to you has helped to introduce you to the subject. If you would like more information on commercial finance, please get in touch with the Pinnacle Business Finance team today.

Low Repayments On Business Loan

“I need a business loan with low repayments”

Low Repayment Business Loan

At Pinnacle Business Finance, this is a phrase we hear a lot. Almost 70% of inquiries start with such a statement. As with our article on cash flow, this is often where small businesses go wrong. The focus on small repayments can blindside businesses into a business loan when other forms of finance may be better suited. Small repayments often mean a longer-term and therefore a longer obligation. The level of repayment doesn’t always match the level of borrowing, especially given the variance in rates. Often businesses go for a low rate. However, they are not aware of what security or other covenants they have agreed too. All these can be mitigated by a decent commercial finance broker.

We have eluded to the fact that many businesses enquire about a business loan due to familiarity with the product. At Pinnacle Business Finance we focus on understanding a business and the root cause of problems. Last month we spoke to a business who tried to sell us the positives of small repayments and the extended loan term. In fact, the business had used another commercial finance broker and initially, they were satisfied. The business had picked up and they had heavy penalties for settling the business loan early.

With 3 years left it was stopping them for gaining the finance they needed to purchase additional stock. Fortunately, we got them a trade finance facility, but they must fulfill the other loan terms. All this could have been avoided if they had taken a business loan over 1-2 years with the ability to pay it off early with no penalty. Being agile in business is key to survival and a similar attitude to finance will have the same effect!

We often speak to businesses to present the options open to them so they can choose what is right for them. We get asked what is the cheapest, purely focusing on the lowest repayments. When we depict the loan terms and the full amount repaid, they are often shocked at the additional interest accrued through an extra year. The loan terms should always be a consideration as this can have a dramatic effect on your cash flow projections. If you are stuck putting your profit into a lenders pocket through interest, then it can inhibit your ability to borrow more.

Security around any borrowing is key with business loans. They are largely unsecured with only a personal guarantee. We work with lenders who are completely unsecured with no PG element and this comes at a small premium. Any business needs to assess what is right for them and understand that the lender will have a risk vs reward matrix. In short, the higher the perceived risk, the higher the repayment. A good commercial finance broker can help point out the obligations with each. Looking purely at the loan term and small repayments may mean you miss what security you are putting into the deal.

We have seen several businesses stuck with cashflow problems because they wanted a small repayment. The longer loan term has meant they are paying a business loan back for a project or item that has surpassed. It leaves a business paying additional interest and being prohibited from borrowing more. A decent commercial finance broker can explain the options available and ensure you make the right decision.

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