The Treasury has recently announced that it is reviewing measures to provide financial support to British businesses, after an action group lobbied for a new fund to support the debt incurred by firms as a result of the Government’s various Coronavirus loan schemes. Despite this being a tumultuous time for small firm owners, research from IW Capital suggests that entrepreneurial spirit across the country is still rife; in fact, 37% of the UK population still feel that running their own business would be an attractive venture. These findings are a reflection of the working resilience across the country, showing that not even a global pandemic can hinder the national optimism of UK entrepreneurs.
The new proposal from the Government would mean small businesses, and those looking to take the leap into entrepreneurship, are able to envision more exciting expectations for post lock-down life. The unprecedented effect of Coronavirus, and its impact on the global economy, has caused unique challenges for businesses. Although the Government loan schemes will undoubtedly have provided a lifeline to many firms, thousands of companies have been left in debt. This new state-backed body could potentially save over three million jobs as businesses try and juggle the debt they have been saddled with during the Coronavirus crisis.
Private equity investment is an alternative option for businesses to scale growth and springboard out of this challenging time. The consequences of an economic downturn have been prominent during this period. This suggests that often Government loans are not the way forward for every business, whilst others may find themselves unable to source Government assistance.
Now, as businesses are trying to grow out of this period with new debt, this may be the time that existing and new businesses look towards private equity as an alternative to scale, save jobs, and even use their investors experience to help scale as the economy recovers from the pandemic.
Businesses have taken on a huge amount of debt in the past few months purely to survive and those looking to grow may be reticent to take on further debt that will need to be serviced with working capital. For growing firms, equity can provide a form of investment that does not put as much pressure on profit and loss in the short-term, while potentially gaining expert advice from investors.
To find out more about IW Capital, or for more information on investment and non-executive opportunities, please speak to a member of the IW Capital team today on 020 7015 2250, or email email@example.com