These days, there’s an ever-increasing level of interest in funding for business – not simply because our recent economic turbulence has spun-out a series of new and ambitious entrepreneurs, but also, as stabilisation continues, because more businesses are innovating new products or services and expansion projects.
In my experience, there are some very simple steps that will serve a business or entrepreneur well in researching and securing funding for a start-up or expansion project. None of these steps are ‘rocket science’ and in fact, can be easily followed (with the right attitude!)
With any prospective application or planned funding project – the first step is, quite simply, to ask yourself why you’re pursuing the application. Is it for product R&D? New employment to support an international scale opportunity? Or are you a start-up bringing a new product or service to market? In every instance, a funder (be they a State agency, VC or bank) will expect that you have conducted relevant, focused research on your prospective plan (product or service), including the identification of potential clients, and the distinct value proposition of this offering. The figures have to stack up, so don’t run away from projections.
Often times, I tell clients to imagine themselves in front of the Dragon’s Den – do you think you have the answers they’ll ask? Have you prepared properly? Remember the old maxim: fail to prepare, prepare to fail.
The next crucial element of funding acquisition depends on your requirement – as mentioned above – different types of funding are relevant to different requirements. In the first instance, a great point of contact is your local LEO (Local Enterprise Office). Recently launched, the LEOs offer a ‘first stop shop’ for all forms of enterprise support. These supports include mentoring (very useful at start-up), training, priming grants, grant aid and access to MicroFinance Ireland loan applications. For less experienced start-ups, the LEO will guide you in terms of any specific areas of support you may need – be that marketing, finance or business planning – remember… no-one knows everything.
For innovative new products, services or R&D, your LEO may also be able to assist by providing a support with a feasibility study – or referring you to Enterprise Ireland, if appropriate, and depending on the international scope of the product / service offering.
Enterprise Ireland offer assistance to businesses, start-ups and new products with a specific focus on international markets and high employment potential. Becoming an EI HPSU (High Potential Start Up) can offer opportunities to explore specific funding programmes tailored towards global market entry, R&D and innovation partnerships. These are just some of the supports on offer from EI – a more complete overview can be gleaned via their website.
When thinking about export funding, it’s also important to remember that there are cross-border trade development programmes which are tailored to both start-ups and SMEs seeking to grow their business in Northern Ireland. Based on recent research, up to 75% of SMEs trading internationally began their export journey in Northern Ireland. InterTrade Ireland’s Elevate and Acumen programmes focus specifically on testing / validating market opportunities, and offering grant-aid for businesses with market potential to employ a sales-person or graduate to capitalise on this potential. Again, this is just a sample of the many programmes on offer from InterTrade – which cover technology transfer, innovation and venture capital.
Other useful tools for new products or services, start-ups or business diversification projects include the many incubation centres (several based at Institutes of Technology around the country) which offer accelerator programmes, such as New Frontiers (supported by Enterprise Ireland) and the Ryan Academy portfolio of supports (High Fliers, Propeller). Many of these programmes also offer funding – and access to VCs or investors.
There are also BICs (Business Incubation Centres) around the country, which offer support in feasibility and development stages – often linking to business angel networks and venture capitalists. State funding for business can also be sought from Udarás Na Gaeltachta, certain local or regional authorities (for example, the Western Development Commission) and the LEADER funds – though LEADER’s next tranche of funding will not come into effect until 2015. There are also specific European funds for research, collaboration – often in the form of projects – these include INTERREG and Horizon 2020.
As I conclude this blog post, I am already sure I’ve forgotten at least one funding option! This clearly highlights the scope and scale of funding available – and though I’m sure many will say that a key factor is eligibility – fundamentally, every business should de-risk their financial requirements before they go too far. If you can’t apply for any funding supports above, how will you fund yourself? At the outset, many businesses will have to self-fund, via personal funds or acquiring sufficient finance from a private source (including banks or other financial organisations). Again, the critical factor is understanding why you need what you need.
So, on that note – I wish you the very best of luck in your funding application – remember, do your research (and watch the analysis paralysis), define the customer and proposition and don’t forget the ‘f word’… finance! Make sure your projections and financials stack up. Good luck!