53% Recommend Invoice Finance For New Startups
Finance for new startups can be tough to find. Often a new business will not have any assets to offer as security to a bank for an overdraft or loan, and many financiers simply won't deal with new startup businesses as the survival rate is lower than for an established business. According to the Office for National Statistics, the UK 5 year survival rate for businesses started in 2008 and still active in 2013 was just 41.3%.
However, there are other options. Invoice finance is available to new startups, even with no previous track record and no other assets (not from all invoice finance companies but there are many that will fund startups). The finance is provided against the unpaid sales invoices of the new business, so as sales are made and invoices are raised, so more finance is released. In this way the level of funding grows with the business.
We asked a group of existing invoice finance users if they would recommend factoring or invoice discounting, as a source of business funding, to new startups. 53% said that they would recommend it to fund a new startup business.
Source: Invoice Finance And Late Payment Survey - October 2015 (100 respondents - all existing users of invoice finance).
More information about invoice finance for startups.