Businesses seek external funding for a variety of reasons. If your business is doing well, you might need to raise cash to fund expansion or perhaps you need additional funding to survive a rough patch. Either way, there’s no magic formula to convince a bank to lend you money or an investor to believe in you. There are however some practical ways you can enhance your chances of securing business finance:
- Business plans are not just for start-ups. Keep your business plan up to date to show investors that you know what you are doing and have a plan in place to realise your goals.
- Keeping your paperwork in order will make the process of applying for funding much simpler and will give potential lenders all the information they need straightaway. Banks might want to see historical data as well as recent figures.
- Use your profit and loss and cashflow forecasts to your advantage. These projections can demonstrate your ability to pay back a loan.
- Prepare periodic management accounts in order to keep track of the actual results compared to forecast.