Borrowing 150k whats the best way and a few other problems !

[needsomehelp]

Hello all long time looker at the forums but first post.

I need to borrow approx 150k and want some advise on the best way to do it other then the bank I have a few ideas,silent partner investing money (angel investor) etc.

I have a very good business and need the money to buy out an existing partner (they want to do something else) I love the business I have spent 17 plus years growing it so don't want to just sell the company as a whole

Any advise ?

[loafer123]

Do you need debt or equity?

You say you want an angel investor, but does the business have any debt capacity?

[foliedouce]

What's the business?

Does it have any assets?

Does it have any existing debt?

Can you stage the payments or do you need the full £150k now?

What is the profit of the business and what is your partners drawings?

Then we we can tell you how to get the cash or if indeed it's possible.

[Mattt]

Funding Circle?

[Mr Overheads]

Mattt said:

Funding Circle?

rebuildingsociety.com

[IATM]

First thing I would establish is if the business portion being sold is worth 150k, I assume you have done some sort of valuation properly and its a fair price?

Other questions I would ask as others have asked, that will give us an insight into the best way to finance the 150k.

[TheBMWDriver]

foliedouce said:

What's the business?

Does it have any assets?

Does it have any existing debt?

Can you stage the payments or do you need the full £150k now?

What is the profit of the business and what is your partners drawings?

Then we we can tell you how to get the cash or if indeed it's possible.

You never know, if you answer these questions you may even find the money here.

Hint Hint...

[needsomehelp]

TheBMWDriver said:

You never know, if you answer these questions you may even find the money here.

Hint Hint...

Hello many thanks all of you for the good reply's we have recently had the business valued it seems to be a very varied process and the costs to get a value varied !

We turn over approx 800k with net profits of 165k I have no idea if the value given of 300k is right I of course would want as low a figure as poss to have to buy him out lol

[liller]

If you've got 2 years worth of audited accounts then I'd say funding circle is your best bet. I raised 80k via them very quickly and easily.

[Du1point8]

I have a query, if you are a new company (2 years old but only properly trading for 11 months) and all of a sudden have a big order, does that make a difference with the best way to borrow money?

I have 2 potentially big orders coming through, they don't seem to want to come one by one and let me weigh one off against the other, both companies have high turnover and good profit (in the millions).

I am a relative small fry and whilst I might be able to cover one with personal assets, Im not sure I can cover 2, would people want to lend to me based on the fact its only for the covering of supplies to the two companies and waiting for payment rather than anything else and would not borrow unless I had too.

Whats the best option for me?

[loafer123]

Du1point8 said:

I have a query, if you are a new company (2 years old but only properly trading for 11 months) and all of a sudden have a big order, does that make a difference with the best way to borrow money?

I have 2 potentially big orders coming through, they don't seem to want to come one by one and let me weigh one off against the other, both companies have high turnover and good profit (in the millions).

I am a relative small fry and whilst I might be able to cover one with personal assets, Im not sure I can cover 2, would people want to lend to me based on the fact its only for the covering of supplies to the two companies and waiting for payment rather than anything else and would not borrow unless I had too.

Whats the best option for me?

I wonder if you could do individual order factoring?

[Mr Overheads]

rebuildingsociety.com have no early repayment fee so you can in effect use it for bridging finance, so perfect for what you sound like you need it for.

[Du1point8]

Mr Overheads said:

rebuildingsociety.com have no early repayment fee so you can in effect use it for bridging finance, so perfect for what you sound like you need it for.

Whats the kind of repayments on say a 6 month peer to peer loan for bridging finance?

I don't see anything other than the rules which I may fall foul on:

2 years worth of accounts
prove turnover greater than xxx amount.

Year 1 of our accounts is nil due to set up process taking that long.
turnover is a little under what is needed due to it being a seasonal company and in we are working hard to change that to spring/summer sell to public, autumn/winter sort out retailers... hence the loan needed.
Profitable... hmmm, as its a tangible product breaking into a difficult market, it demands lots of investment to get the company up and running so its not really profitable until I have the first big retailers onboard. Otherwise it will be profitable as of 2015 as its under its own cashflow now.

Chicken and egg scenario seems to spring to mind.

[needsomehelp]

TheBMWDriver said:

You never know, if you answer these questions you may even find the money here.

Hint Hint...

Do tell me more

[needsomehelp]

liller said:

If you've got 2 years worth of audited accounts then I'd say funding circle is your best bet. I raised 80k via them very quickly and easily.

Yes that's no problem what sort of costs are involoved in borrowing that sort of figure ?

Many thanks

[4lf4-155]

High street banks will fund this at a lower cost than funding circle et al.

At your turnover level it Might take a while to speak to someone in the bank that knows what they are doing but it can be done.

[gregf40]

4lf4-155 said:

High street banks will fund this at a lower cost than funding circle et al.

At your turnover level it Might take a while to speak to someone in the bank that knows what they are doing but it can be done.

I don't agree.

Can't just just buy him out with profits over the next couple of years?

That's what I've done several times in the past.

[4lf4-155]

I'm guessing the other party won't wait for that and wants the cash upfront hence the request for funding

What don't you agree with? The high street bank bit?

[liller]

4lf4-155 said:

High street banks will fund this at a lower cost than funding circle et al.

At your turnover level it Might take a while to speak to someone in the bank that knows what they are doing but it can be done.

Banks will talk to you but they'll want assets at this level where as funding circle won't. I spoke with HSBC before going with funding circle and they weren't especially helpful.

[needsomehelp]

Hi all again thank you for all your advice I have had a meeting with my bank and because the loan to value using my house as security I may not be able to get enough to pay off my partner we have both agreed on 100k buy out .

Can anyone advise me about funding circle I assume they will need my house as security ? If not do they have a share in the business until the loan is paid ?

Many thanks