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Clippy McKenna

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David Versus Goliath - The Fight for Funding

Posted: 05/07/2012 00:00

The first time I heard the term 'double dip', I thought they were talking about the 1980s Sherbet Dip Dab sweet; obviously I was wrong and they were actually talking about the state of the UK economy.

In order help alleviate this downturn, the Bank of England and UK Government have promised to work together to provide £80bn pounds worth of cheap credit to lend banks, which will in theory will be passed onto UK businesses as cheap loans to encourage UK companies to borrow. This they believe will uplift us from the pits of the double dip gloom.

Coming from a small business, I see things differently. I believe that in today's economic climate, it is SMEs that will help to bring this country out of the recession, and that we will be responsible for the economic salvation of the UK. SMEs are the life blood that keeps UK business moving forward and we are responsible for over half the GDP output.

In the USA, start-up equity finance is much more readily available on reasonable terms compared to the UK. I heard the other day that if the UK had the same approach to business as the USA, then there would be an extra 900,000 SMEs within the UK, that's a 10% increase of GDP.

The government has already tried pumping money into the UK economy, but as a small company we haven't seen any benefits. If you want to gain access to finance, most companies go via the banks, however, there are a number of unrealistic strings and charges attached when seeking finance which make it incredibly hard to jump through the hoops and satisfy every criteria demanded by the bank manager.

Our biggest challenge is securing investment and the right investor; this is true of the majority of small companies. We now supply Tesco, Morrisons, Asda, EH Booths and Ocado and yet we still can't find the right investor.

Money isn't the problem, there's plenty of money within the UK, there are lots of potential investors and loads of exceptional entrepreneurs, and the difficult challenge is matching the two. What we're failing to do as a nation is match entrepreneurs with the right investors. The government should be concentrating on creating and cultivating entrepreneurial success, this is what will drive the UK economy not pumping money into the UK economy.

I'm asked on a daily basis, whether I think the double dip recession has hit Clippy's and to be honest, I would have to say no. It's not all doom and gloom as the media would have us believe. The UK needs to create a 'virtuous circle' of successful entrepreneurs. Experienced and proven entrepreneurs will fund less-experienced entrepreneurs with solid business plans - isn't about time we grew some imaginary balls and showed the world what the UK can do?

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