If bank says no, simply explore other options

Aug 5 2008 by Iain Laing, The Journal

HOW I... is a new fortnightly column in conjunction with the Entrepreneurs’ Forum that asks for advice from North East entrepreneurs

SARAH Taylor, of Newcastle travel information firm Urban Digger, said: “We looked at getting more funding from banks, but as soon as they saw we were an online business, they wanted nothing to do with us. It didn’t matter what our concept was or how good we thought the idea was, or anything. A business based on a website was just too high risk for them.

“In the end we basically invested every penny of our savings along with contributions from friends, family, fools. Then it wasn’t just our own financial security we had to worry about; it was the people closest to us as well. But that really spurred us along to make a success of what we were doing.”

JONATHAN Wells, of Sunderland IT firm Guroo, said: “In terms of raising finance, I’d agreed [with my wife] that I would invest a big sum of my own money, or rather money that I’d got out of the sale of my shares from a previous company, into the business.

“I put all of that money aside into a separate account, we never counted it as ‘ours’ so we didn’t feel that every month we were running down our savings, and once it was gone it was gone and I wouldn’t miss it.

“We were fortunate to win some grants from Business Link and the City of Sunderland Council. They were only a couple of thousand pounds each, but they did make a difference. It helped with the initial web development work, marketing and equipment for setting the company up.”

STEVEN Bell, of Stockton shopfitter Newman Scott, said: “There was a time when Newman Scott was losing us around £400,000. As a family we had all of our businesses in the one bank.

“Our bank manager said we either had to close Newman Scott down or sell it. So we changed banks. The business is now in the top 20 best shopfitting companies in the UK.”