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SME Growth Champions presentation 2015

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SME Growth Champions presentation 2015. Presented By: Darlene Menzies. darlene_at_SMEasy.co.za – PowerPoint PPT presentation

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Title: SME Growth Champions presentation 2015


1
SME Growth Champions presentation 2015 Presented
By Darlene Menzies darlene_at_SMEasy.co.za
2
Why do small business struggle to access finance?
  • Lenders and Entrepreneurs views on the challenges
  • Help is urgently needed
  • Addressing common questions
  • Understanding the finance products what are the
    offerings?
  • Choosing the right Finance Provider who are
    they?
  • Getting finance ready what do lenders need from
    you?

3
Darlene Menzies
  • 15 years experience in corporate ICT sector
  • 14 years small business experience
  • Entrepreneur, Innovator, Small Business
    Specialist
  • Twice liquidated I understand entrepreneurs
    and the challenges they face
  • Have gone on to build several successful
    technology companies
  • Successfully raised gt R15m from SA VC Funds for
    multiple pre-revenue start-ups

4
Finance Providers View
  • SMMEs are a priority lending sector for finance
    providers
  • There is plenty of money in South Africa to lend
    to small businesses
  • As lenders money is not the challenge, finding
    the finance ready businesses to lend to is the
    challenge
  • The majority of small businesses seeking finance
    are not finance ready
  • On average 80 of loan applications received are
    40 ready / bankable
  • Entrepreneurs tend to think finance providers
    will lend based on their exciting business story
    or their passion rather than the businesses
    bankability

5
Finance Providers View
  • Most entrepreneurs dont understand their
    business finances and many havent tested /
    proven their business models (i.e. how they will
    make money)
  • Business owners cant answer questions about
    their own business plans, cash flow projections
    and financial statements
  • By far the greatest hindrance to the granting
    loans to small businesses is their failure to
    provide Financial Statements and current
    Management Accounts
  • The lack of finance readiness is an epidemic it
    needs to be urgently addressed practical advice
    and simple finance tools are sorely needed
  • The bottom line is, lenders want to lend, they
    need to lend!
    They are waiting for a pipeline of
    finance ready bankable businesses to lend to.

6
Entrepreneurs View
  • They need to access to finance to establish and
    grow successful businesses
  • They often hearing that SMMEs are key to economic
    growth addressing unemployment - yet it almost
    impossible for entrepreneurs to access finance
  • If government, banks, other financiers and big
    business have money to lend - why arent they
    lending it?
  • Why dont they make it easier to access - the
    lending criteria is very stringent

7
Entrepreneurs View
  • We have many questions, where can we go to get
    answers?
  • What if we have bad credit records or we have no
    collateral?
  • Who are all the lenders? Cant someone provide a
    list
  • What are all the loan offerings, what are the
    differences?
  • A list of all the things a lender requires from
    us would help us
  • Practical assistance is needed
  • Help to complete applications (a lot of financial
    jargon)
  • Help to generate financial statements
  • There should be one place that we can go to get
    answers to the questions we all have and to get
    the vital assistance we need to ready ourselves
    for finance

8
Help is on the way
  • Finfind is an online platform (web and mobile
    based) that brings together the providers and
    seekers of small business finance with a focus on
    readying small business for access to finance.
  • Finance Literacy
  • Easy to understand information specifically
    written for small businesses addresses common
    questions, explains finance jargon, equips
    entrepreneurs
  • Explains the different types of lending products
  • Helps you understand the different kinds of
    lenders
  • Gives a summary of all Government Grants
  • Finance Readiness Test
  • Set of questions to measure finance readiness
  • Businesses who are not ready are assisted with
    their challenge areas
  • Business that are ready are linked with matching
    lenders
  • Finance Readiness Tools
  • Short Online Training Videos (to help you manage
    your admin and recordkeeping)
  • Simple Accounting System (to do invoicing, manage
    cash flow and generate financials)
  • Links to Business Advisors and Accountants

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Help is on the way
  • Finfind is an online platform (web and mobile
    based) that brings together the providers and
    seekers of small business finance with a focus on
    readying small business for access to finance. It
    provides
  • Finance Literacy
  • Easy to understand information specifically
    written for small businesses addresses common
    questions, explains finance jargon, equips
    entrepreneurs
  • Explains the different types of lending products
  • Helps you understand the different kinds of
    lenders
  • Gives a summary of all Government Grants
  • Finance Readiness Test
  • Set of questions to measure finance readiness
  • Businesses who are not ready are assisted with
    their challenge areas
  • Business that are ready are linked with matching
    lenders
  • Finance Readiness Tools
  • Short Online Training Videos (to help you manage
    your admin and recordkeeping)
  • Simple Accounting System (to do invoicing, manage
    cash flow and generate financials)
  • Links to Business Advisors and Accountants

21
Helps you understand the different finance
products
Equity finance VC
Debtor finance
Overdraft
Term loan
Trade finance import / export
Asset finance
Contract finance POF
Supplier credit
Client deposits
Grant finance
Property finance
Personal credit
22
Help is on the way
  • Finfind is an online platform (web and mobile
    based) that brings together the providers and
    seekers of small business finance with a focus on
    readying small business for access to finance. It
    provides
  • Finance Literacy
  • Easy to understand information specifically
    written for small businesses addresses common
    questions, explains finance jargon, equips
    entrepreneurs
  • Explains the different types of lending products
  • Helps you understand the different kinds of
    lenders
  • Gives a summary of all Government Grants
  • Finance Readiness Test
  • Set of questions to measure finance readiness
  • Businesses who are not ready are assisted with
    their challenge areas
  • Business that are ready are linked with matching
    lenders
  • Finance Readiness Tools
  • Short Online Training Videos (to help you manage
    your admin and recordkeeping)
  • Simple Accounting System (to do invoicing, manage
    cash flow and generate financials)
  • Links to Business Advisors and Accountants

23
Helps you to choose the right finance provider
Family friends
Suppliers
Banks
Debtor financiers
Government agencies
Trade financiers import / export
Niche SME financiers
Angels VC funds
Personal Product financiers
Client deposits SA law
24
Lending from Banks
  • Small business are viewed as high risk banks
    look at the viability of the business,
    collateral, affordability of repayments and your
    credit record.
  • First understand how banks allocate loans to help
    you set your expectations
  • Banking world is largely depersonalised
    decisions are not made by a person who knows
    you/your business
  • A credit committee decides whether to approve a
    loan or not
  • Credit committees are only interested in the
    business case i.e.
    the cold, hard facts and figures contained in the
    financial statements
  • Carefully researched ratios determine if business
    plans are realistic or not and if cash flow and
    profit forecasts match up etc.
  • The most common reason for small business loan
    applications being rejected by banks is that they
    are not finance ready.

25
Lets look at banks
  • What are the main things a bank looks
  • Viability of the business
  • Collateral
  • Affordability of the repayments
  • Clean credit record for the business and the
    owners
  • Loans from banks only represent lt4 of the money
    lent to small business
  • but dont be too hard on the banks, remember
    they are lending their clients money!
  • Ask yourself this question when wanting to lend
    money (not just from banks) would you lend
    yourself the money?!

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www.admineasy.co.za
  • Simple training videos to set up a basic
    recordkeeping system
  • Online Training - 6 x 10 minute videos
  • The Entrepreneurs Reality
  • Setting up Your Recordkeeping System
  • Managing Your Business Paperwork
  • Understanding Your Financial Statements
  • Managing Your Staff Records
  • Small Business Basic Legal Requirements
  • www.admineasy.co.za its free

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www.SMEasy.co.za
42
Finance Dashboard
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Get yourself ready what do most lenders ask for?
  • Short company profile or brief description of the
    business
  • Financial statements of the previous 1 - 3
    financial years
  • Current Management Accounts
  • Cash flow forecast that includes how you will use
    the finance you are applying for
  • Bank statements for the last 6 - 12 months
  • Company founding documents (and shareholders
    agreement where relevant)
  • IDs and personal bank details for all directors
    or owners
  • Personal assets and liabilities for all directors
    or owners
  • Details of what collateral is available
  • Details of any personal surety contracts the
    directors or owners have signed
  • Loan specific documents e.g. for asset finance
    they will need details of the asset being
    purchased

47
finfind - watch this space!
  • To keep updated about the finfind launch
  • go to
  • www.finfindeasy.co.za
  • Twitter and facebook
  • finfindeasy and SMEasy

48
SME Growth Champions presentation 2015 Presented
By Darlene Menzies darlene_at_SMEasy.co.za
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