With the UK vaccination programme well under way and global stock markets switching their attention from “stay-at-home” businesses to cyclical stocks most likely to benefit from economic growth, the funding debate moves on from survival funding to recovery funding and how to support businesses in making the most of the growth opportunities that will appear.
Lenders having access to important borrower data can improve the service they provide in numerous ways, from quicker credit decision making to reducing the ongoing administrative burden for their clients. We look at some of the improvements we made in 2020 and plans for the future.
The economic impact of the pandemic has affected mid-sized businesses in many different ways. Greg Beamish, Head of Credit at ThinCats explains how his team responded to the pandemic and continued to provide funding support in such a fast changing and uncertain trading environment.
Open Banking simply provides lenders like ThinCats, which do not hold the main current account of the business, that same visibility. With Covid-19 causing heightened uncertainty around future cashflows, this enhanced transparency helps improve the efficiency, accuracy and flexibility of the lending process to ensure borrowers get the best funding solution for their needs, both now and in the future.
One of the consequences of processing more than 1.6 million government backed loan scheme applications is that banks and alternative lenders have been limited in how much “business as usual funding” they could support. This is especially so for those type of deals such as MBOs or some private equity backed deals that were ineligible for CBILS or CLBILS funding.
Now that the government loan schemes are coming to an end, we recognise there is a growing pent up demand for funding that was not eligible under these schemes. For example, businesses may be looking to acquire new distribution capabilities or rearrange the ownership structure of the business.
As accelerating Covid-19 infection rates led to Boris Johnson announcing a national lockdown on 23 March, who could have predicted what the next 6 months would have in store for the economic health of UK businesses and the personal health of its citizens.
Useful insights for corporate finance advisers and SMEs on how to navigate the last minute rush for CBILS
How we are seeing increasing numbers of CBILS borrowers seeking funding for longer-term growth purposes rather than immediate survival.
A common misconception about CBILS is that businesses backed by Private Equity investors do not qualify. From our experience funding existing customers with CBILS loans – and more recently new borrowers – we are able to support PE backed businesses in several ways, summarised in this blog
ThinCats surveyed over 100 professional corporate finance advisers, brokers and accountants to ascertain their views on the Coronavirus Business Interruption Loan Scheme (CBILS).
As large parts of the UK economy emerge from a pandemic-induced hibernation to take stock of the new post-lockdown reality, businesses’ needs for additional funding will be many and varied.
ThinCats employees were asked to take part in a survey to record their views on the current working situation, and how they could see their working life taking shape in the future.
The full economic impact of the coronavirus crisis and how quickly we return to pre-covid levels of economic activity is difficult to predict. The Government seems keen to learn from the lessons of the 2008 financial crisis when measures to protect banks’ deposit holders led to a lack of vital liquidity for businesses.
Minimising and/or deferring business costs is critical during periods of reduced business activity. In this short blog we take a look at 8 tips that might help a business mitigate costs and improve cash flow.
All of our loans are sourced entirely from institutional capital. Which begs the question: are we now not just like a bank, minus the high-street branch network? The answer is an emphatic “no” for a number of reasons...
“Alternative lending isn’t looking so alternative anymore,” reckons law firm Vinson & Elkins, which services the private equity sector. This is particularly true when it comes to private equity firms raising debt capital. Alternative – also known as direct – lending is the fastest growing asset class in this space.
It is interesting to see that many of the high street banks announce that they plan to lend billions of pounds to support UK SMEs. It reads well as a headline, but does it stack up as a fact?
You can guarantee that when an election is taking place, you’re likely to see a political leader at a local SME. Hard hats, high-vis jackets and eye-protectors are a must for the photo opportunities. Find the local manufacturer or engineering firm and it’s bound to look good in the manifesto.
Whilst the antics of Basil and Manuel of Fawlty Towers fame may not have done any favours for the image of British hotels in the 1970s, today’s hotel sector is an increasingly important part of the UK economy.
ThinCats works with many professional services businesses (PSB) to help their clients – from restaurants to manufacturers – access the capital they need. But we also work with PSBs that wish to raise finance themselves.
A succession plan, lays out how you see the business transitioning, to whom, and the necessary steps along the way to make this happen.
Durable business models are underpinned by strong demographic drivers. That’s certainly the case with healthcare: individually and collectively, we’re not getting any younger, for a start. This, perhaps uncomfortable fact, supports the growth of care homes for the elderly.
Britain’s very oldest family businesses have passed from generation to generation for almost half a millennium. But what’s the best form of transition when the next generation has other plans?
Home to the most mid-sized businesses outside London, see how South East businesses compare to the rest of the UK and discover which towns and sectors in the South East are performing best.
Andy Haigh, partner at BHP Corporate Finance, explains the value that corporate advisers bring in structuring a company buy-out
Succession can be incredibly positive – indeed transformative – for a business. Take a look at our 8 step business exit strategy checklist, which summarises some of the key things to look out for on the road to business transition.
We recently surveyed more than 500 medium sized UK businesses about their experiences when seeking external funding: how often, how much, what for and where from.
It’s no secret that the reputation of the main high street banks has been eroded over the past few years, not least in the eyes of those running small and medium-sized enterprises (SMEs). And, while the new wave of challenger banks have been heralded as saviours, they are beset by many of the same underlying problems as their older, larger siblings.
As a leading alternative finance lender in the fintech space ThinCats has built a regional network of experts based across the UK. Why? Isn’t the whole point about fintech to digitise and automate?
Once upon a time, Britain was a great manufacturing nation. That’s the perception – was. While it’s true that manufacturing makes up a smaller proportion of GDP – 11%, down from about a quarter in the 1970s – what it does, it’s still world class at.
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.
The ability to assess credit risk is fundamental for all lenders. It is an intricate mix of art and science, whereby each lender has its own view when determining their appetite to lend and at what price. While there are some commonalities between each lender’s credit risk models, what is deemed a great business by one may appear less attractive to another.
Technology companies are the UK’s economic powerhouse, growing 2.6-times faster than the rest of the UK economy. Indeed, the 50 fastest-growing UK tech companies claim an eye-watering 2,176% average growth rate and a combined revenue of £1.2bn, according to Deloitte.
A “secured loan” has historically required that a borrowing company post an asset as collateral, such as equipment or property, to “secure” the capital that a bank loans to them. Given that this is the predominant type of secured loan, SMEs understandably equate the term with a need to own property or specific types of asset. However, there is another important type of secured loan that does not require collateral in the form of physical assets: the cashflow loan.
Eating out is a British small business success story. Consumer spending in restaurants has risen over the past five years, reaching £22.5bn in the last quarter of 2018. The number of restaurants and mobile food operators has tracked this upwards, reaching nearly 87,000 in 2017.
Small business growth opportunities are being stymied through lack of capital, research has found . This is exacerbated because many businesses feel they are unlikely to get a loan to fund their growth plans.
The high street bank continues its move from community cornerstone to museum piece – to the detriment of Britain’s small businesses.
2018 was a breakthrough year for ThinCats. Read more about how our investments in people, technology and data helped us fund more UK businesses than ever before and why business advisers are increasingly turning to ThinCats to create the bespoke funding solutions that their clients demand.
In 2018, we launched PRISM Prospect, our predictive data model based on analysis of hundreds of thousands of businesses over 25 years. PRISM Prospect identifies businesses likely o have a funding need over the next 12 months. The model segments UK SMEs into five propensity categories from very likely to unlikely.
Employee ownership is becoming an ever-more popular way for owners to sell their business. In recent months, firms as varied as book producers, landscape gardeners and a niche operation doing luxury conversions of VW campervans have taken the decision to go down the route pioneered by John Lewis. Even shadow chancellor John McDonnell seems to want to get in on the act
When you take out car insurance do you just opt for the first quote you get, very unlikely. The same goes for a mortgage, an investment fund or a pension plan. You shop around via the internet, a broker or an aggregation service
Employee-owned businesses saw a major boost to their popularity once their advantages were enshrined in legislation through the Employee Ownership Trust in 2014. The EOT is a form of employee benefit trust, but with distinctive features and tax advantages.
How the collapse of global finance a decade ago decimated SME lending and catalysed an alternative
The UK’s rapidly expanding small business sector is something of a sleeping giant, with young companies in need of better access to finance to kick-start their growth. In the transition from start-up to scale-up, a critical factor for a growing business is the quality and flexibility of available funds.
At ThinCats, we have a policy of targeting our lending to growing companies. In doing this, we strongly believe that alternative finance is playing a positive role in increasing the productivity of British industry
SME event-driven finance is fast becoming the natural terrain of the alternative finance industry. Before the financial crisis, banks dominated all areas of business lending. Alternative finance meant getting some money from your mum. But things have changed. Regulation over the past decade has forced banks to retrench. In the years immediately after the crisis, net lending to SMEs fell heavily into negative territory.
British industry is caught in a paradox. There has been a severe slowdown in productivity since the financial crisis, despite the world going through what’s been described as the fourth industrial revolution. It’s as if Watt develops the steam engine, Stevenson builds his rocket, Cartwright unveils the mechanical loom and Britain’s rate of growth somehow still slows.
By opening up new flows of capital to UK SMEs, alternative finance is playing an important part in helping UK talent drive improved economic growth. Read our paper on why the UK should care about finding alternatives to traditional bank funding, the benefits to businesses and the future of funding
The banking network is shrinking, and it is bad news for businesses. The good thing is, there’s now an alternative.
Stewart Cazier, our head of retail, was interviewed by Simon Lambert of This is Money on what investors need to know about alternative finance, crowdfunding and the IFISA for the Investing Show.
Just when we had settled into the ‘new normal’ of bargain-basement rates, the Bank of England starts raising them, with a 0.25% rise in November and more could be on the way.
Banking has changed beyond all recognition over the last decade. Many high streets are now with-out a traditional bank as, according to The Times, some 802 branches closed in 2017 alone – a figure that seems certain to accelerate this year.
Amid current fascination with driverless cars, it’s worth considering how far we are from a driverless credit process, as it were – what do algorithms and AI have to offer, and what still requires human consideration?
It’s possible that Edmund Hilary and Tenzing Norgay weren’t the first people to make it to the top of Everest. When George Mallory’s body was discovered on the slopes of the mountain 75 years after he disappeared in 1924, it was apparent he was descending, having been last seen 800 vertical feet from the summit
There used to be a rule of thumb in pension planning, that the percentage of bonds or other income-bearing securities, in one’s pension portfolio should equal one’s age. Things are somewhat more complicated and that, hopefully, has been replaced by more grounded and detailed analyses.
P2P investments can play a vital role in retirement planning. Over the coming months, we will be taking a look at key issues around P2P loans and retirement planning.
From our analysis of the market we anticipate lower average loan rates, along with an increase in loan quality. These linked trends are a confluence of events in the wider alternative finance SME loan market – indeed, debt markets generally – and ThinCats’ own due diligence.
You want to go to cinema, but what to see? Easy – just pick the film with the highest rating. Five stars and you’re front and centre, with super large bucket of popcorn. Western, scifi, romcom, action – doesn’t matter, just so long as it’s got the most stars.