Strategic Objective 2: Access to Finance
Worcestershire’s business community reported in the November 2011
Open for Business survey that access to finance and its lack of availability
remains one of the top barriers to business growth. It is therefore important
that the LEP tackles this priority in the macro economic environment since
2008
which has seen the longest and deepest recession in history. It is clear
that since the banking crisis, the rules of engagement and the accepted
levels of risk have changed between business and lenders. The LEP will
develop a pro-active approach which ensures that businesses can access
support to produce a deliverable business plan for investment and which,
in turn, gives confidence to the lender.
Smaller businesses in general have more difficulties accessing finance compared
with larger companies, and SME’s rely heavily on the main banks rather than less
formal avenues of finance. Often the barriers for SMEs are:
•
lack of a proven track record to support loan applications
•
prohibitive costs of due diligence to consider equity finance
•
a poor appetite for financing innovation
•
funds in short supply for firms between start up and self sustaining take off
•
weak access to information about the alternative methods of finance
We will focus on two key areas:
•
Harnessing the expertise and knowledge of the professional sector.
Bringing together these key partners and stakeholders to secure more
investment in Worcestershire businesses.
The LEP will seek to put financial providers into a delivery model which allows
a brokerage between providers and small businesses. LEP partners also have
available “funding-finder” tools and these can provide a sound foundation for
development of a model which gives local businesses access to capital with
practical support and advice.
•
One delivery model of various finance options to local businesses.
The delivery model for different finance options is likely to need specialist support
and expertise in bringing the right partners and best professional networks
together in order to ensure that opportunities are identified, sifted and delivered
in a targeted way as part of a wider support offer to local entrepreneurs.
The LEP website will be the delivery model:
•
a point of contact for businesses to access a range of financial options
and expertise, removing one of the main barriers to growth
•
a better understanding of the opportunities available to investees and
how they can link into the process
•
local access to a wide variety of funds and opportunities
•
supporting businesses to become ‘investor ready’ through liaison
with professional financial advisers and other bodies to prepare them
for investment
•
Financial commitment by the private sector to make the model
self sustaining
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