ThinCats recently conducted a survey with corporate financial advisers on the current drivers, restrictions and trends in SME financing in the UK. Join us in this brief article as we collate the survey’s results on the funding market for SMEs, including the notable rise of alternative finance as a means to support SME growth.
Forging partnerships with the UK’s most trusted business advisers
As a relationship driven organisation, working closely with business advisers through our regional development and credit teams helps us get close to the SMEs that we support and deliver funding solutions that are bespoke for their specific need. In the last year we have worked with a variety of different business advisers, helping numerous businesses secure the funding they need.
One such relationship that has proven extremely successful in recent months is with TLP Consulting Ltd. (“TLP”). They were looking for “new and innovative approaches to sustainable lending” to provide cutting-edge deals for their clients.
The largest adviser in Harrogate, TLP’s work ranges across the UK, with clients based from London to Manchester. Regarded as one of the most progressive and entrepreneurial professional services firms in North Yorkshire, TLP is SAGE accredited and offers a comprehensive suite of accounting, taxation and advisory services.
We have worked together to secure successful MBOs for two key clients: CMS Tools Ltd. (“CMS”), a specialist roofing tools supplier, and VUS Limited (“VUS”), a civil engineering company. These two very different companies, with their own unique financing needs, both approached TLP for financial advice to facilitate MBOs:
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Founded in 1991 by Steven Smith, CMS is based Normanton, West Yorkshire. CMS employs a team of 10 staff working across the provision of specialist products and tools not stocked by trade counters and large roofing contractors.
In late 2018, Steven approached his financial advisers about facilitating an exit strategy that would still enable him to retain part of the business. So, his advisers, TLP, invited high-street lenders and alterative finance providers to pitch for the loan portfolio. After inviting several contenders to pitch including traditional clearing banks and private equity houses, it was Ben Kimball, Business Development Director for ThinCats, who provided the most comprehensive credit-backed plan to finance the Management Buy-In.
Following on from the success of CMS’s MBI, TLP approached ThinCats with another client, VUS, who required a Management Buy-Out. Based in Derbyshire, VUS is one of the region’s leading Civil Engineering companies. Again, ThinCats provided the most comprehensive deal which would enable VUS new management to acquire the business.
What began as one client deal between ThinCats and TLP, is evidence of a definitive shift in the wider market. Specialist loans that require increased flexibility and innovation are being tackled successfully by alternative finance providers who take the time to fully understand the business and their growth plans.
Both deals were supported by Dahren Naidoo at Freeths for the borrowers, and Ben Slack at Clarion for Thincats.
Paul Land, Managing Partner, TLP, said, “Our business is based on trust - our clients trust us to find and advise on the best deals that will match their business needs. With our extensive client base that ranges across the UK, we are always looking for new and innovative approaches to sustainable lending. I was impressed by Ben’s drive and sophisticated approach to business, and these two deals mark the beginning of a promising relationship between our two companies.”
Ben Kimball, Director of Regional Development, ThinCats, said: “Advisers like TLP are a great example of how local businesses can help each other for the benefit of their clients. We were happy to facilitate two strong deals for forward-thinking companies. Alternative finance providers continue to prove that we can plug the funding gap, and the support from local businesses is our greatest endorsement.”