Top funding tips for small business
More than half of Australia’s small and medium enterprises (SMEs) are applying for funding without a business plan and two-thirds without a prepared cashflow forecast, according to new research.
The State of SME Funding report reveals that SMEs believe funding will dramatically lift their business confidence – 45% of business owners expecting more than 50% growth after receiving funding.
The report is a snapshot on funding for the Australian SME community, based on data collected from 200 business leaders in the SME and start-up community. You can read it here.
It’s not uncommon that SMEs fail to cover all bases and do their homework when seeking funding says Mike Boorn Plener, the author of the report and founder of Business Connector in Sydney.
‘We sit with businesses every week that are floating a proposal to the capital market or to a bank without having thought through fundamentals like revenue strategy, serviceability, return on equity and many other essentials.
‘Most business owners only seek funding once or twice in the life of the business, so the basic skills required to applying for funding are not always practised.’
SMEs are the unsung heroes of the Australian economy and employ over five million people, says Stuart Zalunardo, Acting Head of SME at St.George, who believes it’s beneficial for business owners to know the nuts and bolts of a funding application process.
Business owners should know the nuts and bolts of a funding application process.
‘We want to help SMEs prepare their business in the best light to gain funding so they can start, prosper and grow their business,’ Mr Zalunardo said.
To help you become successful in your funding application, here’s a list of top tips.
St.George’s top-tips for accessing funding
Prepare a business plan
Develop an up-to-date business plan and summary to ensure that your financial projections in the plan match your funding requests.
Prepare a cashflow forecast
This will help identify how much funding you need, when you need it, how your business can repay loans and how long it will take to repay the loans.
Have your paperwork in hand
Make sure you have all your paperwork ready including a list of personal assets, your tax returns, bank statements and superannuation funds.
Shop around
Do your research to find the best form of funding for you. Events such as Funding Connector can give you great insights into ways to secure funding for the growth and expansion of your business.
Present your skills
When meeting with the investor, ensure your business knowledge and skills are spot-on. If it helps, ask your accountant to go with you.
Dianne Edwards, St.George Bank
