Starting a new business can be a daunting process for both beginners and experienced individuals. Infrastructure, contacts, marketing, employees and supplies are all things you could easily lose sleep over. Then there is the most important thing, where are you going to get your business from?
In some cases an organic process of building the new business through word of mouth and a good marketing strategy will be enough to get regular enquiries and generate income. However, in some industries there will be a regular requirement to obtain formal contracts in order to secure the short and long term sustainability of the business. In all cases, winning a valuable contract can not only help sustain the business but allow it to grow and thrive.
How can a bid writing company help?
That’s where a good bid writing company can make the difference. By engaging the services of an experienced bid writer, you can find suitable tenders available in your industry that match your specific requirements. Contract values can range from a few thousand pounds to a few million, so there is a contract available for all business sizes and experience levels. All tenders are not made equal, with some being more suited to new companies than others.
What a bid writing company like Tenderhelp will do is consider many factors, including: your business aspirations, current situation (including resources and previous experience), competitiveness of the industry, desired geographic area etc. and advise which tenders are the most appropriate for you and would give you the very best chance of being successful.
HMRC are sending ‘Nudge letters’ recently to individuals to check that their personal tax affairs are up to date and have been correctly disclosed on their UK tax returns. HMRC have issued these letters to taxpayers where via automatic exchange of information from other countries that the individual may have offshore income or gains. HMRC do not indicate which tax year it relates to, therefore it could be multiple.
HMRC generally give 30 days from the date of the letter to respond to these letters.
What action should I take?
There is no need to panic if you receive one of these letters, as HMRC have various reasons for sending them to individuals:
Discrepancies in the data received from overseas tax authorities which HMRC is unable to reconcile may be a reason for the request.
Changes to the individual personal circumstances or tax laws which have resulted in earlier advice obtained being out of date.
New information may be supplied to HMRC (e.g property purchases etc.) and this needs clarifying with them.
If you do receive a letter, we would recommend that you contact your usual tax advisor for support.
Disclosures
If you do have income and or gains to declare there are a variety of HMRC campaigns potentially available to you:
A disclosure can be made via the Worldwide Disclosure Facility, Let Property Campaign, and any Digital Disclosure Service or Contractual Disclosure Facility (deliberate omission) if there are income and/or gains to declare.
HMRC usually impose a 30-day timescale, however, if it is not practical to respond in this time, an extension will be required.
Tax consequences
There may be tax consequences of not providing a response to HMRC if later untaxed income and or gains are discovered:
HMRC may open an enquiry into an individual’s tax returns for specific tax years
HMRC can impose penalties for failure to notify based on Potential Lost Revenue depending on the individual’s behaviour. Penalties may vary but this can be up to 200% if it involved an offshore matter.
False statements could result in criminal prosecution
Price Bailey can take the burden of the HMRC enquiry from you by:
Preparing and filing of any undisclosed income and gains to HMRC
Responding to HMRC on your behalf if you receive such a letter.
If information does need to be disclosed to HMRC, we would be happy to discuss with you the various disclosure methods available and submit the disclosure for you
For any assistance needed please contact Nikita Cooper or Jay Sanghrajka.
This article was written by Nikita Cooper, Tax Director at Price Bailey. If you have any questions and would like to speak to Nikita, please contact us on the form below.
We always recommend that you seek advice from a suitably qualified adviser before taking any action. The information in this article only serves as a guide, and no responsibility for loss occasioned by any person acting or refraining from action as a result of this material can be accepted by the authors or the firm.
You can view this article in its original setting with Price Bailey Here
Individual savings accounts (ISAs) and their various predecessors offer savers the ability to hold cash or a wide range of investments with no tax due on returns. However, for some, the complexity around some of these vehicles has inhibited their full use within their financial plans.
When were ISAs introduced?
The first precursor to ISAs were Personal Equity Plans (PEPs), which were introduced by former Chancellor Nigel Lawson in 1986 to encourage wider ownership of equities. At its peak the annual allowance was limited to £3,000 into one single company or £6,000 into a collective investment. However, some savers were put off by the restriction of only being able to hold equities. Accordingly, Tax-Exempt Special Savings Accounts (TESSAs) were introduced by the then Chancellor John Major in 1990 to provide an alternative of holding cash.
Neither of these vehicles would survive the new Labour government of 1997 with Individual Savings Accounts introduced in 1999 and further contributions to both PEPs and TESSAs stopped. However, the tax advantages of any existing savings continued with TESSAs able to roll into ISAs on maturity and PEPs converted to ISAs in 2008.
Why the history lesson?
As neither vehicle has been available for new funds for more than 20 years the precise detail of each is somewhat redundant. However, those savers who did make use of these early iterations of the ISA will have been able to make substantial funding into tax-free vehicles as well as enjoying anywhere up to 34 years of growth on their savings!
This is highlighted by the increasing number of ‘ISA millionaires’ in the UK who have managed to save at least £1m in ISAs with the majority having started this before ISAs even existed. While there have been several formats and even more changes to restrictions, rules and funding limits, those that navigated these will have benefited hugely.
The most flexible ISA ever!
In 2013 the option to hold shares listed on the Alternative Investment Market was introduced, giving savers the option to build an ISA portfolio qualifying for inheritance tax exemptions for the first time.
Following this, ISAs were launched with a separate contribution allowance for stocks and shares (£7,000) and cash (£3,000, if used reduced stocks and shares allowance), which prevailed until 2014 when savers were given the option to utilise the full allowance (£15,000) in either a stocks and shares or cash ISA, or a combination of both. This provided much more flexibility to amend the way ISAs were used as life changers, such as moving investment ISAs to cash to reduce risk or to invest cash ISAs to achieve higher growth.
From 2016 Flexible ISAs were introduced allowing savers to make withdrawals and return these funds to the ISA in the same tax year without it counting as a new subscription; however, caution was needed as not all ISAs were flexible ISAs.
Who does not love an acronym?!
In recent years, further iterations of the ISA have been introduced:
IFISAs – innovative finance ISAs providing access to peer-to-peer lending
LISAs – lifetime ISAs to encourage saving for house purchase or retirement with government ‘top-up’ of 25%
JISAs – junior ISAs allowing savings for children up to age 18
HTBISA – help to buy ISAs to assist savers from age 16 in the purchase of a first home (no longer available)
While most of these products have helpful applications, it has been suggested that the increase in options has led to perceived complications with ISAs. Previously, relative simplicity compared to other options such as pensions had been a strength of ISAs.
What does the future hold?
While there was no specific mention at the recent spending review, the consensus is that the UK is likely to face increased taxation in the near future to repair the damage done to public finances by the COVID-19 pandemic. Nevertheless, it is clear this will be a difficult balance as direct increases to taxation could well derail a potential economic recovery.
It is relatively likely that at least part of the burden will fall on savers and investors, in particular much has been made of the disparity between rates of income tax and capital gains tax (CGT). If we do see increases to CGT, this will make ISAs even more attractive in allowing investors to build a portfolio free of CGT (as well as income tax).
However, with the exception of the government incentive on lifetime ISAs there are no initial tax reliefs for investing in ISAs and therefore they are typically funded from taxed income, which can be inefficient for higher and additional rate taxpayers (assuming 45% tax and 2% National Insurance on the full amount, an additional rate taxpayer would need to earn £37,735 to fund their £20,000 ISA allowance).
Therefore, ISAs are likely to retain their current role as an extremely valuable and flexible part of an overall financial strategy, but for many they will work particularly well alongside other tax-efficient methods of saving such as pensions and venture capital trusts.
Start a conversation today
Get in touch with a member of the Mattioli Woods team below. We’re always on hand to assist.
This article has been produced for information purposes only. It is not intended to be an invitation to buy or act upon the comments made. All investment decisions should be taken with advice, given appropriate knowledge of the investor’s circumstances and one must satisfy certain investor criteria before being considered eligible to invest. Any forward-looking statements and forecasted returns represent the current views of Mattioli Woods plc and may be subject to change. Your capital may be at risk and past performance is not a guide to future returns. Mattioli Woods plc is authorised and regulated by the Financial Conduct Authority.
“I set up The Engaging People Company in 2017 because I know that engaging people is key to success.
I have seen first-hand how powerful it is when we engage people. My background is in communications and engagement and I have over 20 years’ experience working in this area. Prior to setting up The Engaging People Company up I was the director of engagement for a not-for-profit housing provider, responsible for both staff and customer engagement. During my time there, I was so proud to lead the organisation’s successful entry onto the Times Top 100 list three years in a row.
Over the last two decades, I’ve worked in-house and within consultancies in Norfolk and Newcastle-upon-Tyne for a range of organisations operating in social housing and the public sector as well as the private sector too. I have always taken a focused and targeted approach to engaging people, depending on the needs and priorities of the different people we are engaging. In this way, we can reach more people.
I’m also a qualified coach and mentor and over the last decade, I’m had the opportunity to support many different coaches to achieve their goals. I’m an experienced facilitator too and I like to lead sessions in an inclusive and empowering way so that everyone gets a say.
I’m passionate about supporting and empowering wellbeing and I’ve worked with a number of clients to develop and embed wellbeing plans. I also get to work with some amazing colleagues to deliver wellbeing themed training.
I have founded the company on my own personal values and these underpin how I live and work.
Aside from The Engaging People Company, I write – fiction, poetry, prose, shopping lists….anything and whenever I can. Most recently, I have been curating ‘When The World Paused’, a diary of lockdown featuring 76 voices. (The book is coming soon).
And, I spend time with my amazing family. In everything that I do, I’m driven to be an empowering role model for my daughter Thea. I want to inspire her to fulfil her own ambitions, whatever they may be. As a motto that I live by goes:
Can we help? We’d love to hear from you. Please do get in touch:
This week, NAAME coordinator, James was lucky enough to catch-up with Rachel Littleboy, Marketing Executive at Fix-a-Form International and Db Engineering Services. Conversations of course lead down the path of how Lockdown had treated Rachel and the company. The conversation alluded to the group’s great resilience and intuition to diversify their production to support the ventilator challenge.
Db Engineering Background
Db Engineering is a family-owned business, part of the Denny Bros Group and has been manufacturing Fix-a-Form® leaflet label machinery since 1982. They have an international reputation for their bespoke machines made at Denny Bros Group headquarters in Bury St Edmunds, which is then shipped all around the globe.
Industry Diversification / Demand Valve Diversification
Rachel Littleboy, Marketing Executive at Fix-a-Form International/Db Engineering told me:
Due to the nature of our industry and the fact that our engineers have to travel abroad to install the machinery, coronavirus halted our plans for 2020. We were supposed to be exhibiting at a leading trade show in the label world in Chicago this September, and all plans of engineers travelling to make amendments or servicing to machines had to be cancelled. If staff could work from home they have been, I was luckily enough to be able to do this, which has seen its own challenges but has generally worked very well.
Ever the optimist amidst a global pandemic, I started to think of other industry sectors we could help out whilst we were technically all ‘grounded’. I saw on the local news that local firm Meditech, in Halstead, who manufacture medical equipment were switching their production lines to help make ventilators, I contacted Meditech to see if there was anything we could do to help with the demand. They placed an order for ‘Entonox demand valves’ so we stopped the manufacturing of our parts and switched production. The parts were produced and delivered all within a few days. Our work tends to be one-off parts or low quantity runs, meaning our engineers work to very fine tolerances. Meditech was pleased with the work and gave special thanks to our engineers that produced them. We have completed subsequent orders for Meditech since and have now produced over 1200 demand valves for them.
Reduced Lead Times
Looking at the global pandemic from the label’s perspective, I created a white paper on the effects Covid-19 has had on the label printing industry. You can download the white paper for free via this link – https://fix-a-form.com/covid-19/
Luckily, we are in a position to be able to switch production and prioritise new work at short notice at the moment, meaning parts can generally be ordered and produced within days rather than weeks. Our team at Db Engineering have worked throughout the pandemic and it is pleasing that in these difficult times we are able to use our lathes and milling machines to help sectors with an increased demand.
If you require any parts manufactured or would like any further information on the services we offer, please email enquiries@db-engineeringservices.co.uk or call us on 01284 723144
With special thanks to Rachel Littleboy, Marketing Executive at Fix-a-Form International & Db Engineering for sharing their fantastic diversification story with us. A true example of British Manufacturing stepping up to meet the demands and challenges that the pandemic surfaced.
This week, NAAME Project Manager, James was lucky enough to catch-up with Sunil Vara, Business Engagement Manager for UK Centric Supply Chains. Aston Univeristy’s UK Centric Supply Chain Programme is a fully funded consultancy support package to further investigate your supply chain.
UK Centric Supply Chain Programme
Aston University’s UK Centric Supply Chain Programme still have availability and can help you investigate your supply chain! There are still places left for their fully funded 1-2-1 consultancy-based support and open, interactive workshops.
The programme will asssit companies in the manufacturing, engineering, food & drink sectors to strengthen the supply chain through mapping assessment and improve existing capabilties. Firms will gain a better understanding of their business in terms of customer, geography, locations and relationships with suppleirs.
In addition, the programme offers expert advice and will assist your business to devleop an action plan to improve and strengthen your suplpy chain moving forward.
Why Should Businesses Apply?
The programme is fully funded and therefore has no cost. Allowing all buisnesses access to free, expert advice.
There is support to identify issues withinteh business
An action plan will be produced to supoprt de-risking o the supply chain
Support to develop a strategic plan will also be offered
Enables businesses to have a more overarching/strategic view on associated processes
What is the Value to Businesses?
Outside perspective in and provides non-biased view on the supply chain from Aston University
Provides a holistic, validated and verified road map of the supply chain
Provokes thoughts and questions surrounding unknowns within the business
Fully tailored and adaptable to most business both SME and large businesses
High level view to support strategic planning
Potential for cost and risk reduction
1st Tier and lower Tier assessment and visibility
Who’s eligible?
This programme is free to SME’s with a minimum of 12 hours of bespoke support to look at your supply chain. This proejct is funded by the European Regional Development Fund and has certain restrictions with postcodes. Please review the diagram below for a rough guidance on eligible areas. If you require any further information, assistance or guidance, please don’t hesitate to get in touch and James will make formal introductions to the project lead.
With special thanks to Vara Sunil from UK Centric Supply Chains who took the time to inform us on this great fully funded programme for SMEs across various sectors. If you would like to find out more information, please don’t hesitate to get in touch.
With government advice and support changing rapidly as the Covid-19 pandemic evolves, it’s hard to keep up with the latest news in business support. From closures, furloughed staff, huge drops in productivity and increased remote working, your business or organisation is most definitely not the only one facing uncertain times, as every sector faces immense pressure in knowing what to do next.
Here at Hethel Innovation, we’re still offering our support to businesses the best we can and understand our role is more important than ever as businesses start to adapt to new ways of working. So we’ve put together this live blog to feature all of the funding newly available for small businesses and start-ups during Covid-19, updating any changes as they happen. Whether you’re unsure if your business is eligible for any funding or need more information on how to apply, these direct links will take you straight to where you can find out more and get started.
Our entire team are always on hand to offer free support with funding bids, such as proof-reading, critiquing or any other queries. Get in touch with us regarding your Coronavirus concerns and any other questions by giving us a call or sending over an email.
For Businesses:
(Scroll down for the latest funding for charities)
Latest Funding Opportunity: Power To Change Community Business Renewal Initiative
Power To Change has launched a new £3million support package providing grants, 2 match funding programmes and tailored support to help communities protect their assets. The renewal fund offers unrestricted grants of between £10,000 and £20,000 in order for community businesses to adapt, renew and rebuild, with areas of priority being those in England with high levels of deprivation and organisations led by disabled people, Black, Asian and Minority Ethnic (BAME)-led or BAME-supporting businesses.
Round Two – NOW OPEN closes Tuesday 12th January 2021 4pm
Round Three – Tuesday 2nd March 2021, 10am-1pm
Social investment Business: Resilience & Recovery Loan Fund
The £25million fund for emergency loans to social enterprises and charities is closing for new applications on the 31st March. Social Investment Business has already approved loans of £100,000 – £1.5million with no fees or interest for the first 12 months to over 50 social enterprises and charities, which are unable to trade normally and face financial difficulty.
The scheme which saw many businesses through the first lockdown was due to end on the 1st of November, with the Job Support scheme taking its place. However due to further lockdowns in England through the end of 2020 and into 2021, the scheme has been extended to cover the period from 5th November all the way through until spring 2021. Employees will receive 80% of their current salary for hours not worked up to a maximum of £2,500. Businesses will still have the option to bring back furloughed worked on a part-time basis, or continue on a full -time furlough basis. The cost to employers retaining employees has also been reduced for this extended period, as they are only asked to cover National Insurance and employer pension contributions.
With the Job Retention Scheme (Furlough) now set to end in March 2021, the Chancellor Rishi Sunak may still bring in the new Job Support Scheme to replace it in the spring, to further support individuals and businesses. It holds string of different support solutions for businesses which are forced to close due to local lockdowns and those businesses who are open but struggle to bring in custom, to receive a percentage of their income paid by the government strictly depending on whether they meet the requirements.
Businesses instructed to close during local lockdowns and the national lockdown (5th Nov-2nd Dec 2020) are able to receive financial support from their local councils. For every 3-week lockdown period, businesses that occupy a premises with a rateable value of less than £51,000 will receive £1,000 safety net to help protect them. Businesses with a rateable value of £51,000 or more will receive £1,500 for every 3-week lockdown period. Local authorities will receive a 5% top-up of funding to support other businesses affected by closures.
The new £2billion scheme to help young people into work will feel like a life-line for many 16-24 year olds who are deemed to be at high risk of long-term unemployment. For businesses who are seeking to create job placements for young people, the funding received for employer applicants could help make the decision a lot easier. Employers who are able to create 30 or more 6-month job placements can apply and receive 100% of the relevant National Minimum Wage for 25 hours a week per job, plus National Insurance and funds for uniforms and other enrollment costs. The creation of 30 placements without replacing existing vacancies is a tough ask for some, therefore the scheme allows organisations to partner with others, in order to create the minimum 30 placements.
The scheme is open until December 2021 with the possibility of extension. Find all of the information through the link above.
A new £20 million funding scheme launched by the Government is set to help smaller businesses recover from the effects of Covid-19. Small and medium sized businesses in England will be able to apply for between £1,000 – £5,000 to help them access new technology and other equipment to aid recovery and growth. The funds can also be used for legal, financial or other types of advice to help during this period. Funding has been spread between Growth Hubs within each Local Enterprise Partnership (LEP), with a minimum of £250,000 for all LEP areas. So, for businesses in our region, contact New Anglia Growth Hub on how to access the funds.
The BT Small Business Support Scheme is designed to build recovery and growth for SMEs following COVID-19 and features a range of support aimed at boosting connectivity, cash flow and confidence. Ultra fast business connections, mentoring services and bursaries of £1,000 for UK tech start-ups are all readily available by connecting BT Group directly.
Future Fund- For Innovative Businesses
https://www.gov.uk/guidance/future-fund
In the works for UK businesses driving innovation and development, the new billion-pound support package named Future Fund, could be a saviour for keeping afloat in order to come out the other side of current lock-down. With the government announcing more ways that businesses can access this funding in the coming weeks, so far we know it can help SMEs focusing on research and development, as long as the business is an unlisted UK registered company that has previously raised a certain amount in equity investment from third party investors. The scheme has bee extended and will now close Monday 30th November 2020.
Helping SMEs bounce back, this loan scheme launched at the beginning of May, offering between £2,000 – £50,000. The length of the loan can extend up to 6 years, with the government guaranteeing 100% of the agreed loan amount, with no fees or interest to pay for the first 12 months, but with interest rates rising to 2.5% after that. With 11 lenders participating in this scheme, look to approach the most suitable lender for your business. If the first choice declines your bid, there is always the option to apply with another one. If your business needs more support with this, get in touch and we can lend a hand.
Here’s a different type of scheme for smaller businesses to access loans and other kinds of finance of up to £5 million. The government promises 80% of the finance to the lender and will pay the interest and any fees for the first 12 months. There are over 50 lenders supporting this scheme, however businesses will need to show that they have been greatly impacted by Covid-19 and that the business would be viable were it not for this.
This funding is targeted at front-line charities delivering vital work throughout Coronavirus, to which the government promises a £750 million pot. £370 million of this pot is allocated for small and medium sized charities making an impact during lock-down by delivering food, essential medicines, providing financial support, to name some. It is thought this funding will be delivered via means such as the National lottery Community Fund grant and government departments. Information states that departments are currently working to determine priority charities, with the aim to distribute the funding in the coming weeks.
For all available government support and advice during Coronavirus, visit the main government guidance page here. Or if you need more help finding which financial aid from this list is best suited for your business, give this Gov Financial Support finder a go.
With government advice and support changing rapidly as the Covid-19 pandemic evolves, it’s hard to keep up with the latest news in business support. From closures, furloughed staff, huge drops in productivity and increased remote working, your business or organisation is most definitely not the only one facing uncertain times, as every sector faces immense pressure in knowing what to do next.
Here at Hethel Innovation, we’re still offering our support to businesses the best we can and understand our role is more important than ever as businesses start to adapt to new ways of working. So we’ve put together this live blog to feature all of the funding newly available for small businesses and start-ups during Covid-19, updating any changes as they happen. Whether you’re unsure if your business is eligible for any funding or need more information on how to apply, these direct links will take you straight to where you can find out more and get started.
Our entire team are always on hand to offer free support with funding bids, such as proof-reading, critiquing or any other queries. Get in touch with us regarding your Coronavirus concerns and any other questions by giving us a call or sending over an email.
For Businesses:
(Scroll down for the latest funding for charities)
Latest Funding Opportunity: Power To Change Community Business Renewal Initiative
Power To Change has launched a new £3million support package providing grants, 2 match funding programmes and tailored support to help communities protect their assets. The renewal fund offers unrestricted grants of between £10,000 and £20,000 in order for community businesses to adapt, renew and rebuild, with areas of priority being those in England with high levels of deprivation and organisations led by disabled people, Black, Asian and Minority Ethnic (BAME)-led or BAME-supporting businesses.
Round Two – NOW OPEN closes Tuesday 12th January 2021 4pm
Round Three – Tuesday 2nd March 2021, 10am-1pm
Social investment Business: Resilience & Recovery Loan Fund
The £25million fund for emergency loans to social enterprises and charities is closing for new applications on the 31st March. Social Investment Business has already approved loans of £100,000 – £1.5million with no fees or interest for the first 12 months to over 50 social enterprises and charities, which are unable to trade normally and face financial difficulty.
The scheme which saw many businesses through the first lockdown was due to end on the 1st of November, with the Job Support scheme taking its place. However due to further lockdowns in England through the end of 2020 and into 2021, the scheme has been extended to cover the period from 5th November all the way through until spring 2021. Employees will receive 80% of their current salary for hours not worked up to a maximum of £2,500. Businesses will still have the option to bring back furloughed worked on a part-time basis, or continue on a full -time furlough basis. The cost to employers retaining employees has also been reduced for this extended period, as they are only asked to cover National Insurance and employer pension contributions.
With the Job Retention Scheme (Furlough) now set to end in March 2021, the Chancellor Rishi Sunak may still bring in the new Job Support Scheme to replace it in the spring, to further support individuals and businesses. It holds string of different support solutions for businesses which are forced to close due to local lockdowns and those businesses who are open but struggle to bring in custom, to receive a percentage of their income paid by the government strictly depending on whether they meet the requirements.
Businesses instructed to close during local lockdowns and the national lockdown (5th Nov-2nd Dec 2020) are able to receive financial support from their local councils. For every 3-week lockdown period, businesses that occupy a premises with a rateable value of less than £51,000 will receive £1,000 safety net to help protect them. Businesses with a rateable value of £51,000 or more will receive £1,500 for every 3-week lockdown period. Local authorities will receive a 5% top-up of funding to support other businesses affected by closures.
The new £2billion scheme to help young people into work will feel like a life-line for many 16-24 year olds who are deemed to be at high risk of long-term unemployment. For businesses who are seeking to create job placements for young people, the funding received for employer applicants could help make the decision a lot easier. Employers who are able to create 30 or more 6-month job placements can apply and receive 100% of the relevant National Minimum Wage for 25 hours a week per job, plus National Insurance and funds for uniforms and other enrollment costs. The creation of 30 placements without replacing existing vacancies is a tough ask for some, therefore the scheme allows organisations to partner with others, in order to create the minimum 30 placements.
The scheme is open until December 2021 with the possibility of extension. Find all of the information through the link above.
A new £20 million funding scheme launched by the Government is set to help smaller businesses recover from the effects of Covid-19. Small and medium sized businesses in England will be able to apply for between £1,000 – £5,000 to help them access new technology and other equipment to aid recovery and growth. The funds can also be used for legal, financial or other types of advice to help during this period. Funding has been spread between Growth Hubs within each Local Enterprise Partnership (LEP), with a minimum of £250,000 for all LEP areas. So, for businesses in our region, contact New Anglia Growth Hub on how to access the funds.
The BT Small Business Support Scheme is designed to build recovery and growth for SMEs following COVID-19 and features a range of support aimed at boosting connectivity, cash flow and confidence. Ultra fast business connections, mentoring services and bursaries of £1,000 for UK tech start-ups are all readily available by connecting BT Group directly.
Future Fund- For Innovative Businesses
https://www.gov.uk/guidance/future-fund
In the works for UK businesses driving innovation and development, the new billion-pound support package named Future Fund, could be a saviour for keeping afloat in order to come out the other side of current lock-down. With the government announcing more ways that businesses can access this funding in the coming weeks, so far we know it can help SMEs focusing on research and development, as long as the business is an unlisted UK registered company that has previously raised a certain amount in equity investment from third party investors. The scheme has bee extended and will now close Monday 30th November 2020.
Helping SMEs bounce back, this loan scheme launched at the beginning of May, offering between £2,000 – £50,000. The length of the loan can extend up to 6 years, with the government guaranteeing 100% of the agreed loan amount, with no fees or interest to pay for the first 12 months, but with interest rates rising to 2.5% after that. With 11 lenders participating in this scheme, look to approach the most suitable lender for your business. If the first choice declines your bid, there is always the option to apply with another one. If your business needs more support with this, get in touch and we can lend a hand.
Here’s a different type of scheme for smaller businesses to access loans and other kinds of finance of up to £5 million. The government promises 80% of the finance to the lender and will pay the interest and any fees for the first 12 months. There are over 50 lenders supporting this scheme, however businesses will need to show that they have been greatly impacted by Covid-19 and that the business would be viable were it not for this.
This funding is targeted at front-line charities delivering vital work throughout Coronavirus, to which the government promises a £750 million pot. £370 million of this pot is allocated for small and medium sized charities making an impact during lock-down by delivering food, essential medicines, providing financial support, to name some. It is thought this funding will be delivered via means such as the National lottery Community Fund grant and government departments. Information states that departments are currently working to determine priority charities, with the aim to distribute the funding in the coming weeks.
For all available government support and advice during Coronavirus, visit the main government guidance page here. Or if you need more help finding which financial aid from this list is best suited for your business, give this Gov Financial Support finder a go.
Well, it was certainly a very busy last quarter to cap off what has been an extremely tumultuous year!
Financial markets were jittery during October as the ‘2nd wave’ of COVID-19 infections really took hold in Europe and the US. Thankfully, November saw the arrival of viable vaccines and a Biden win in the US elections which helped fuel a remarkable bounce in markets. The month of December was far quieter for markets despite the news that a Brexit deal had been agreed and a new far more infectious variant of the virus had been discovered in the UK.
Despite the disruption caused by the virus, the World’s financial markets have had a strong year with most markets finishing the year in positive territory. However, the UK market has been the ugly duckling among international markets in 2020 largely due to its heavy exposure to oil companies, which have had a terrible year as demand for oil dropped off a cliff when countries across the World implemented draconian measures to suppress the transmission of the virus.
With all that has happened during 2020 it is an appropriate time to reflect and consider the lessons we can take from this, and past experiences.
Learning from history and experience
Without a doubt the pandemic is the biggest world event for at least a generation, posing possibly the sternest challenge the world has faced since World War II. Fortunately, the news that highly effective vaccines have been developed means that we should now be at the beginning of the end in terms of the pandemic upending our lives. This short note is intended to highlight just some of the lessons we should look to take from history’s big events.
Be prepared for the highly improbable
In the UK death from infectious disease went from the most common cause of death in 1915 to one of the rarest by 2015. The dramatic decline in the number of people dying from infectious diseases in the 20th Century was driven by factors such as mass vaccination programmes, rising living standards, and improvements in nutrition and hygiene.
Over the last century we have become so good at preventing pandemics that few people before January 2020 assumed an infectious disease would ever impact their lives. Many epidemiologists have consistently warned that we have been overdue a pandemic and that it was only a matter of time until one would befall us. However, as a society we became complacent and began to believe that pandemics were a historical malady or something that happened in less developed countries.
It is therefore arguable that if COVID-19 had happened in the early to mid-20th Century society would have been much better prepared as our collective understanding of the danger presented by disease outbreaks would have been far fresher in our minds. Moreover, as we have become further and further removed from past events, we no longer have a grasp of the risk posed by a pandemic striking, consequently we have been content in seeing our taxes diverted from funding medical advances aimed at tackling infectious diseases into other areas that could be perceived as being more deserving and in need of immediate attention.
More than 100 years of ‘calmness’ in relation to infectious diseases has understandably bred complacency. We see the same type of thing happen to economies and financial markets. When there are no recessions or market crashes people take on more and more risk, then when financial meltdown does occur the impact tends to be far worse than if people had been cognisant to the actual risks and behaved in a more responsible manner.
Good times come and go, as do the bad times. Whilst history may not repeat itself it does at least rhyme, however, we as humans have a habit of forgetting this.
Buy and hold: Save like a pessimist but invest like an optimist!
Human progress and the improvements that we enjoy as a society are a slow and gradual process, taking far too long for anyone to notice let alone make the evening news. The stories that grab people’s attention tend to be the bad news stories that happen instantly. History has shown us time and time again that in the long run things are generally pretty good however, in the short run it is usually pretty bad.
Investors require a great deal of skill and patience to reconcile the internal conflict of being a short-term pessimist but an optimist in the long run. For at times investors’ can just feel that they simply lurch from one setback or crisis to the next without ever growing their wealth. However, these short-term problems in fact work in the favour of the patient and disciplined investor with a long-term view. As the glorious effect of compound investment returns only really kick in over the long run. Compounding simply means the ability of a sum of money to grow exponentially over time by the repeated addition of earnings to the principal invested. This effect is so powerful that Albert Einstein once described it as the 8th wonder of the World. The skill lies in being able to stick to the plan long enough for compounding to work its magic.
Large events have several causes
The world is an incredibly complex place and is thankfully stable enough so that one person or company cannot in isolation cause an event that impacts the whole world. However, what does happen is that unrelated things collide all the time to shape the world we live in. The film director and documentarian Oliver Stone described history ‘as the story of lots of things happening at the same time’. If we think about the year just gone for example there has been the perfect storm of events that culminated in the pandemic. A virus jumps from an animal to a human, that human then mixes with other people, as the virus spreads among a small group of people it remains a mystery for a while, once authorities realise that it is a new virus, they try to suppress the news at first in the hope that the outbreak would be contained. Unfortunately, other countries believed it would be contained and failed to act fast enough in dealing with the virus.
It would be fair to characterise the initial response from the major developed countries as over optimistic and even arrogant. As evidenced through the lack of preparedness and denial that the developed world would be affected by the virus. There was a belief that we would come through this episode relatively unscathed. Yet, when the first wave hit it became abundantly clear how unprepared we were, leaving panicked Governments with only one option left to respond to this new threat: lockdowns.
Be careful not to dwell on past events
It is important not to be defined by our bad experiences. Whilst it is vital to learn lessons from powerful and extraordinary experiences, we must be careful not to learn too much from the unusual nature of these experiences. Events like the 2008/09 financial crisis and current pandemic are so rare that most of us will never go through anything like it again. When discussing the stock market crash of 2008/09, the investment consultant Charles Ellis put it best when he said that ‘you don’t want to be so well prepared to go through it again that you lose the chance to have positive experiences for the more normal part of life’. This applies even more so to today’s present situation.
Many investors learnt valuable lessons the hard way during the Global Financial Crisis. The magnitude of the financial crash and widespread bank failure understandably shook many people’s confidence in the global financial system to such a point that many investors were so exhausted by the unrelenting stock market losses that by March 2009 they sold their investments and put their money into cash, but by doing so they turned a temporary loss in to a permanent loss. The lesson from this is not to let our current experiences disrupt our long-term plans.
Predicting the future is a fool’s errand: Flexibility is your friend
Most of time the biggest risk to our way of life is from the risks we do not see coming. At the start of 2020 if you had asked any economist or investor to list the main risks to the economy, they would likely have said trade wars, Brexit and tightening monetary policy (increasing interest rates too fast). Yet, it was a virus that no one saw coming, which ended up causing havoc to the global economy on a scale that would have been scarcely believable back at the start of 2020.
The way to approach an uncertain future is with a plan flexible enough to react to the changing environment. We find it useful to build financial models for clients that help give us a guide to what the future may look like. We build these models using a set of macro-economic assumptions about economic growth, investment returns, interest rates and inflation rates. We then overlay this with assumptions about tax, life expectancy and household expenditure. However, none of this can ever take account of the possibility, however remote, of outlier events like wars or political crises or natural disasters or pandemics.
With vaccine rollouts gathering pace we are hopeful that 2021 will be a far better year than 2020.
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Are this years investment trends a worry or an opportunity?
Magic Sauce
There’s a rise in crowdfunding activity and venture debt based on what I’m seeing at the moment, so I thought I’d try and put a high level view of what’s going on into our blog. This is based on what I’m currently seeing through social media, early data and the various fora and social media platforms I devour daily.
Angels, SEIS and Crowdfunding
We’re already hearing that SEIS investments prior to the tax year end are likely to be lower this year by double digits than last year. The murmurings are that fewer Angels are parting with money at the sharp end of the tech startup landscape with SEIS as the major incentive. We should see that confirmed in the new tax year, but what worries me most is that it may give the UK Government an excuse to scrap the scheme saying that use is declining and thus there’s less interest in it.
Part of this can probably be explained by the rise in “retail” investing (crowdfunding) through the likes of Crowdcube and Seedrs. I’ve never seen so many companies successfully raise through crowdfunding and the trend seems set to continue.
The attraction is that you can bet lower amounts across a greater range of companies and the user journey for this is simpler than scouting for startups, doing the due diligence yourself and getting yourself involved in the startup directly. My own bit of amateur psychology tells me that a proportion of investors will feel good investing in a number of startup at lower stakes too because it means they’re reaching more people (and at the end of the day, most Angels like to help startups and pay it forward).
The surprising downside to all of this is that the likes of Seedrs and Crowdcube are struggling as separate entities. That tells us that they haven’t quite worked out the right business model yet, or they’re just not profitable entities. Either way, the rise of crowdfunding seems set to continue unabated (and someone will no doubt hit the right business model with the number of crowdfunding platforms that are joining the ecosystem).
Another downside is that part of the excitement of Angel investing is linked to that involvement (no matter how small) that you could have a direct impact upon the early success of a startup.
The upside of crowdfunding to a startup is that if you have some early indications of interest from investors and you think there will be sufficient interest to complete the round using a multitude of smaller batch investors then you could be onto a winner. Could be super useful in attracting interest and customers too.
Downside is that you do have to have a budget for a decent video pitch and you need to get your proposition looking slick (with all of the other stuff like financials, go-to-market plan, etc., ready that you’d need for pitching rounds to Angels or syndicates).
VC’s and Debt Funding
VC’s seem to be experiencing a bit of a deal flow lull at the moment and as much as that seems odd, it’s not entirely unexpected.
More and more growth stage businesses seem to be more attracted to the non-dilutive and easier to obtain venture debt. We probably won’t see data on this for some time, but there are more and more stories appearing on those £/$2m+ raises that scale ups and later stage startups are turning to venture debt as a means of raising the money they need.
The upside for a growing company is that it’s fairly easy to obtain, you spend less time “pitching” for money, and it’s based on your results & forecast metrics. You’ll probably get a lot longer to pay it off and that debt can grow with you if you’re on a mega-growth curve.
Downside is that you’re likely to miss out on some of the “smarts” that come with VC funding from the right people (and in the past, more favourable valuations). You also have to factor in the debt repayments as far as your forecasts go.
So..
It’s no bad thing, this variety of funding.
There have been accusations that with a lot of VC’s working on referral only business and operating at arms length from the people they’re meant to engage with that just like any market, they’re ripe for disruption. For the last few months, the scouting networks of some of the more nimble VC’s and micro-VC’s has grown and they’re looking to dip into the shallower, early years end of the pool. I just hope they don’t bring the restrictive terms of higher investment levels down to pre-Seed levels.
The market has probably led the change to more retail investing so people can take less risk at Angel investment levels and operate in a large herd to enhance survival rates and chances of success.
What the Venture debt vs Venture Capital debate does do at scaleup levels is offer a broader range of options, and provides other options for growth capital that weren’t on offer in such abundance previously. It will be interesting to see if all of those venture debt lenders are able to offer the kind of board expertise or advice those scale ups may need to get to an IPO or substantial exit.
What the rise in Crowdfunding offers is again another avenue for startups to gain investment at an early stage. What we are in danger of losing is direct involvement from successful ex-entrepreneurs who could add so much advice to early stage businesses.
If we could see a little more of what the ex-Revolut guys have done in kicking off Expansion Capital it would give heart for the future that we could see SEIS funds being built and managed by ex-entrepreneurs that could give that advice and focus to the next generation of tech superstars.
In the UK, the Government’s Future Fund may have had an effect on early(ish) and growth stage tech startup funding needs too, but it’s too early to tell.
What is certain is that the first cheque is harder to get than ever for tech startups, so even if it is easier to shop through startups on a platform, look for something exciting you can help and play a part in rather than just being number 123 on the Shareholders Agreement. I’m not saying you shouldn’t have a punt, but do get your hands dirty too. Founders need you more than ever.
Beauhurst have put together some data based on last year’s figures for the UK with commentary on what to expect going forward here.
I’d love to hear your own thoughts, so please join the debate.
Finally
While you’re here, I’d also like to invite you to complete a survey by Beauhurst on potential changes to Capital Gains Tax/Disposals that would directly affect investors and entrepreneurs. You can find the survey here. There is talk that instead of paying around 30% tax on disposal of shares (or a company), that you’d lose up to 45%. Have your say in the survey. We don’t need to make investing or starting up a company any less attractive.
A linguistic misunderstanding created much amusement over the weekend – and a memory to treasure too. My daughter had asked my husband: ‘What do you want for your birthday?’ ‘A lie-in,’ he’d replied, with the weariness of one who hasn’t slept properly in five years. Later, I asked her: ‘What do you want to get Dad for his birthday?’ ‘A LION,’ she replied, confidently.
When I’d finally stopped laughing, having watched him open his cuddly new lion with an air of bemusement, one thought struck me and stayed with me. Her complete lack of judgement. My daughter didn’t question or challenge her dad in his request, she didn’t ask him if he was sure, she didn’t wonder if she’d misheard. She simply accepted that this was his choice and it was not for her to project her own prejudices or beliefs onto his decision-making.
I don’t know when we become more judgemental, when we become weighed down by expectations that can limit our openness. But what I do know is that non-judgement enriches the experiences we have, frees us up to find new solutions, and empowers us to follow our goals and ambitions.
Non-judgement is an important factor in engaging people. After all, the very act of asking people what they think and feel shows that we are not relying on our own perceptions and understanding – we are opening the question up to gain that insight, trusting in the experiences and knowledge of others. When we are engaging people, how we ask questions is important too: the more open we can be, the less we shape the direction of travel of the feedback we get. And, then to paraphrase George Michael, listening to others – our staff, customers, partners, stakeholders – without prejudice. This can be trickier, but when we free ourselves of expectations, and disassociate personally from what we are being told, we can learn so much.
And this can lead to real innovation and creativity. When we ask, listen, and learn without judgement, we can do great things. We can shape new ways of doing and working – things that we might not previously have envisaged.
But perhaps where we use judgement most is with ourselves. How often do we think ‘I’d like to….’ but before we get any further throw a great big ‘I can’t’ in our way? How frequently do we stop ourselves taking a step forward towards our goals, our ambitions – our dreams – because of our own thinking errors, hurdles at which we stumble? How many times have we been offered an opportunity but said ‘no’ because we judge ourselves with limiting perceptions?
And it’s not just the judgement we use with ourselves. It’s the perception of how we might be judged: ‘what will people think?’ The fact is people aren’t probably thinking what we imagine them to be, and besides, what does it matter anyway? And yet, we let their perceived judgement stop us from taking a step forward.
Through non-judgement, we can hear more, see more, learn more, and enjoy richer, different experiences – and perhaps we can achieve the dreams we aspire to too.
And maybe, because of non-judgement, we can end up with a birthday present that we never knew we wanted, but which could not have been any more perfect.
Getting a good night’s sleep is one of my favourite subjects, in fact at the Yes Group Norwich talk I did way back in January, I inadvertently turned it into a Stand-up Comedy act. But there is a very serious side that we just don’t pay enough attention too. Lack of sleep in the short-term will lead to mood swings, lack of concentration, mistakes, lack of energy, headaches, general fuzziness and poor decision making, to name a few. In the long-term, it’s a big risk factor in many major diseases, from Type 2 Diabetes to heart conditions, to many cancers. Basically, we need to give our body and brain a chance to rejuvenate and recharge. Generally, we all (adults) need around 7-9 hours. I challenge anyone who says they need less. You might get less and think you are OK, but you are not, trust me.
But enough of the science lesson. What I want to talk about today is the inevitable disruption we all had in our sleep during the early part of the pandemic. With increased stress, anxiety and uncertainty and a big change in most people’s routines, it’s no surprise we all suffered. Even The Sun is reporting on How American’s lost sleep.
How has your sleep been lately?
But personally, I noticed how well I’ve been sleeping lately. I wondered how you were feeling? Are you getting a better night’s sleep than you did? I’ve asked a few clients and colleagues and generally to consensus is the same. It’s like our body and minds are playing catch-up. We need it, and when we do, mother nature has the amazing ability to make things happen.
If you are still struggling to get a good nights sleep, then all is not lost. Try these simple sleep routine and good habits to try to get back on track from Matthew Walker, first published at fastlifehacks.com (He’s a pretty big deal in the sleep world).
1. Stick to a sleep schedule
We should aim to go to bed and wake up at the same time each day. People generally have a hard time adjusting to changes in sleep patterns. Unfortunately sleeping late on weekends doesn’t make up for poor sleep during the week. If necessary, set an alarm for bedtime. Matthew emphasizes this is the #1 priority from the list; stick to a regular sleep schedule.
2. Don’t exercise too late in the day
Exercise is great, and we should try to exercise at least 30 minutes on most days. But try to time it no later than 2-3 hours before bed.
3. Avoid caffeine & nicotine
Colas, coffee, teas (that aren’t herbal) and chocolate contain caffeine, which is a stimulant. Even consuming these in the afternoon can have an effect on your sleep. Nicotine is also a mild stimulant, and smokers will often wake up earlier than they would otherwise, due to nicotine withdrawal.
4. Avoid alcoholic drinks before bed
The presence of alcohol in the body can reduce your REM sleep, keeping you in the lighter stages of sleep.
5. Avoid large meals and beverages late at night
A lights snack before bed is okay, but a heavy meal can cause digestive issues, which interferes with sleep. Drinking too many fluids can cause frequent awakenings to urinate.
6. Avoid medicines that delay or disrupt your sleep (where possible)
Some commonly prescribed heart, blood pressure or asthma medications, as well as some over the counter and herbal medicines for coughs colds or allergies, can disrupt sleep patterns. If you have trouble sleeping, it may be worth speaking to your doctor or pharmacist to see if any of the drugs you’re taking may be contributing to this. It may be possible to take them earlier in the day.
7. Don’t nap after 3 pm
Naps are great, but taking them too late in the day can make it hard to fall asleep at night.
8. Make sure to leave time to relax before bed
It’s important to have time before bed to unwind. Try to schedule your days so that there is time to relax before bed.
9. Take a hot bath before bed
The drop in body temperature after a bath may help you to feel sleepy, and the bath can help you to slow down and relax before bed.
10. Have a dark, cool (in temperature), gadget-free bedroom
We sleep better at night if the temperature in the room is kept on the cool side. Gadgets such as mobile phones and computers can be a distraction. Additionally, the light they emit, especially the blue light, suppresses the secretion of melatonin. Melatonin being a hormone that regulates sleep/wake cycles – with it increasing in the evening to induce sleep. There are things we can do to reduce the blue light at night:
A comfortable mattress and pillow can set you up for a good sleep. Those with insomnia will often watch the clock, turn it away from view so you don’t have to worry about the time while trying to sleep. Use these tips to optimize your sleeping space.
11. Get the right sunlight exposure
Sun exposure during the day helps us to regulate sleeping patterns. Try to get outside in the natural sunlight for at least 30 minutes per day.
12. Don’t stay in bed if you (really) can’t sleep
If you find yourself still in bed for more than 20 minutes, or you’re starting to get anxious in bed, get up and do something else until you feel sleepy. Anxiety whilst trying to sleep can make it harder to fall asleep
