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Does raising finance feel like a hurdle on the road to growth? We can help at every stage of your journey.

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Half the battle is identifying your needs and deciding on the most appropriate type of finance.

Then comes what can feel like a never ending journey to actually getting the money, whether it is applying for bank finance, pitching to investors or satisfying grant criteria.

As daunting as raising finance can be, capital is an essential ingredient for business growth. Think of it as a journey. Make sure you ask yourself and others the right questions along the way to ensure you avoid bumps in the road and successfully reach your destination – raising the funds.

If you’re looking to secure external finance you’ll need a robust and up-to-date business plan that outlines your financial forecasts. It should clearly state the financial need and related funding proposition. If you're seeking equity funding, remember to include the forecast return and exit strategy for the investor.

Tips to get started

Before you start the journey, consider the following tips:

  1. A clear understanding of what you plan to do with any external investment will help get you on the right track.
  2. A robust and up-to-date business plan that outlines your growth expectations and potential, and your funding needs is a necessity.
  3. Before seeking outside investment, think about what finances you already have in place and if you can make them work better or harder.
  4. A management team that isn’t on-board could result in issues further down the line.
  5. Be prepared to answer tough questions about your business from potential funders.

Types of funding

There are many different types of funding options available, such as debt, equity, or grants. Remember funding can come from more than one source. It’s about having the right mix for your business.

Debt finance

Debt finance can include bank loans. It doesn’t come with as much support as equity finance but it carries additional benefits such as:

  • No loss of ownership
  • Suitable for short-term funding needs
  • Can be tailored for discrete projects

Equity finance

With equity finance comes the need to share ownership of your business. But an investor can also bring additional benefits such as:

  • Experience and expertise
  • Valuable contacts
  • Marketing knowledge
  • Management skills
  • Mentoring support

Grants

Grants can be a useful source of early stage funding to help with things like your proof of concept, innovating and developing your product or recruiting staff which debt or equity providers may not be attracted to support. 

The process can be time-consuming but in addition to the cash, grants have additional benefits such as: 

  • No reduction of ownership to your business
  • Reducing your overall funding need 
  • Providing expert support and guidance during the application process
  • Essential support to develop and improve your business

Our investment arm, the Scottish Investment Bank, can help you at various points along your journey to finance.

Financial readiness support

More about the Scottish Investment Bank