Why 1 in 3 start-ups fail and how to make sure yours doesn’t

Starting a business is hard. But keeping it going is even harder.

You’ve probably heard the stats about start-up failures. Apparently 8 out of 10 start-ups fail in less than two years according to Bloomberg.

They will be many complicated reasons.

An analysis published in Fortune magazine of over a 100 business post-mortem essays identified at least 20 different reasons.

One of the top causes for start-up failure is running out of cash, which affected almost a third of the businesses in the research.

Even though a business can be making lots of sales it can still run out of cash.

Sometimes a business can appear to be booming when it is making sales and being productive. But cashflow gaps can affect any type of business, especially if it doesn’t keep track of its financial health.

As we like to say “Sales is vanity, profit is sanity and cash is reality”.

So what can a start-up so to plug the cashflow gap?

It can be more proactive in getting its customers to pay sooner by implementing credit control processes. Bank loans and overdrafts are an option too.

But for a more flexible form of working capital a start-up can try Invoice Factoring or Invoice Discounting.  

With invoice finance you can draw the value of an invoice, meaning you have a cash-injection to last until your customer pays.

With access to funds up-front, you will have the freedom to make payments on regular bills such as weekly payroll commitments, rent, material costs, or leasing costs.

It’s flexible because there is no need to increase or re-negotiate your amount as you would with a bank overdraft or other borrowings.

Our invoice finance facilities are available to most UK businesses, especially small businesses and start-ups.

It’s easy to let the initial excitement motivate you at the start-up phase. But after the honeymoon period has ended a serious entrepreneur will find the right solutions to business problems.


Start closing your cashflow gap

If you’re tired of seeing that widening cashflow gap then maybe one of our Invoice Finance solutions could work for you.

With Invoice Factoring you will get to work closely with one of our friendly, highly-trained credit controllers and a dedicated Relationship Manager. Or if you would prefer to maintain full credit control then Invoice Discounting could be cashflow solution for you.

At Skipton Business Finance our friendly teams across the UK can provide your business with working capital from as little as £25,000 to as large as £5m.

Our Invoice Factoring or Invoice Discounting solutions can provide a much-needed cash injection for B2B SMEs based in the UK. No more 90 day waits for payments.

If you would like a no-obligation FREE quote email info@skiptonbf.co.uk or use the quick and simple form on the right and one of our regional experts will call you back.


About Skipton Business Finance (SBF)

Skipton Business Finance provide businesses with working capital through flexible Invoice Finance solutions, including Invoice Factoring, Invoice Discounting, our confidential My White Label solution and our interest-free Skipton Select solution.

SBF can provide working capital to a business by advancing funds varying from £25,000 up to £5m.

Backed by the Skipton Building Society, we look at the individual merits of a business as part of our underwriting criteria.

We look at potential sales figures and the whole context, not only credit scores.

We don’t just run details through a computer to make a decision. We sit down with you and understand how your business operates, how you want to be funded and how we can support you. 

Want to understand how Invoice Financing can help your business? Why not have a look at our solutions:

My White Label

Disclosed Invoice Factoring

Recourse Invoice Factoring

CHOCS Invoice Factoring

Confidential Invoice Discounting

Disclosed Invoice Discounting

Recourse Invoice Discounting

Invoice Discounting for Small Businesses