Financing a New Business in UK: Step by Step Guide


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The biggest problem most budding entrepreneurs face when starting out is acquiring the funding to get their business idea off the ground. A survey from FreeAgent recently found that 61% of UK residents would like to start their own business, but 51% of them cited ‘the financial burden of setting up’ as their number one concern. In this article, we will walk you through the process of funding your venture and signpost to useful resources along the way. Planning is key when it comes to raising money; you must have an in-depth understanding of your business’ financials, solid projections drawn up and a clear plan for the future in place.

61% of UK residents would like to start their own business, but 51% of them cited ‘the financial burden of setting up

Draw up a Budget

When starting out, it is essential that you draw up a business budget as evidence to support your finance applications and to enable you to answer important questions from banks, lenders or investors. If you start small, you’ll be able to scale these budgets with your projected growth. Huw Moxon from Informi has shared his top tips and real-world examples to help you create your first business budget–read more here.

Decide How Much You Need

Drawing up a budget will enable you to see how much you actually need. A common mistake early-stage business owners often make is asking for too much money. Be realistic with growth plans and forecasts so that when you’re quizzed, you can back up your figures. As part of this plan, there may be different stages of funding that you will go through. This round may be to acquire premises, purchase machinery or get your branding designed. As you grow, there will be different needs, so be clear about what is essential now and what can be slotted in further down the line. Once you’ve come to a figure you feel confident about, it’s good to get some feedback from another business owner or mentor. Alternatively, search out your local growth hub; they can be a useful centralised information point and offer valuable resources, advice or signposting.

Short-Term Borrowing

After putting your plan in place, you may identify that you only require funding in the short-term. Generally, short-term lending means the money will be repaid within 12 months and is considered cash flow management rather than a financial investment.

  • Invoice Financing –

    This is a great way to quickly free up cash on outstanding invoices owed to the business. As a smaller venture, you may have longer terms of payment on your invoices, leading to periods of poor cash flow. Invoice financing has become more flexible in recent years, with companies like Penny revolutionising the industry.

  • A Short-Term Personal Loan –

    If the business hasn’t been operating long and you just need a small injection of cash to get you up and running, this is a good option. Ensure you have thought it through and can afford the repayments however things pan out. Your first port of call should be your bank. If you don’t have any luck there, we would advise consulting your local growth hub for alternatives.

Close-up of businesspeople shaking hands

Long-term Borrowing

If you decide a larger amount of money is needed, it’s important to do your research before signing on the dotted line. It is worth ensuring the company structure is in place to protect you, or that you have a backup plan if everything doesn’t proceed as predicted.

  • Bank finance –

    the traditional route for many businesses. You can apply for a business loan with any high street bank. They will request documentation and forecasts from you and may require guarantees.

  • Alternative debt finance –

    if you are turned down for a loan from your bank, there are other responsible lending agents out there. The application process is similar, but the interest rates may be slightly higher than a bank-backed business loan.

  • Start-up loans –

    are government-backed loans where the borrower/s can each borrow up to £25,000 to a maximum of £100,000 for any one business. Critically, these loans are personal loans, and repayments will be made by the individual, not the business.

  • Investors –

    this is referred to as equity capital and will require you to relinquish a portion of ownership. This could be a great way forward but can become complicated; more on this later.

  • Crowdfunding –

    this is a fantastic way to raise capital that you don’t necessarily need to pay back in ‘money’. It is particularly effective for product-based ventures with a strong brand identity that people can get behind.f

Start-up loans are government-backed loans where the borrower/s can each borrow up to £25,000 to a maximum of £100,000 for any one business

What should I have prepared before seeking finance?

Each institution and application will be different, but there are a few key documents you should have together to make the process run as smoothly as possible. If you are at a very early stage, you may not have all of these documents, but you will still need an understanding of what they are, along with predicted figures based on evidence and analysis. These documents include:

  • Annual Statutory Accounts
  • Management Accounts
  • Profit and Loss Account
  • Balance Sheet
  • Cash Flow Forecast
  • Personal Assets & Liabilities Statement

It is also wise to grasp the abbreviations used within the business finance world. We have explained some of the most common ones here.

Ways to Finance Your New Business

We’ve briefly outlined some of how you can raise capital for your new venture. In this section, we’ll look more into your options so you can decide which is best for you.


Personal Investment

Investing your own money is the simplest way to set up your business. Save up and don’t put in more than you can afford to lose.

Friends and Family

If you do require a little extra help, friends and family can provide a resource of finance. As you can imagine, this one can get complicated. We would always advise having a written contract in place, so everyone is on the same page. This document should also outline what will happen if things don’t go according to plan. It’s not being pessimistic, it’s being practical.

External Investors

Investors come in all shapes and sizes, and you need to be clear on their motivations before agreeing to take their money. For example, angel investors are interested in exciting start-ups that they can contribute to, venture capital firms will be looking for strong growth potential, and private equity firms will want a controlling stake in your business. All will want to see a return on their investment, but what they can bring to the table massively varies. Your decision should be based on what you feel the business needs from them and the outcome you want. Is the business a lifestyle for you, or is the goal to be ‘private-island’ rich within 10 years?

Business Loans

If you are just setting up your business and have no trading history, it may be difficult for you to obtain finance from a bank. Similarly, alternative lending organisations will still want to see some sort of financial records and usually only deal with companies that have at least 12 months of accounts to show. As previously mentioned, you can take out a Start-Up Loan. However, you are personally responsible for repayments even if the company folds.

Business Grants

There are many different business grants available from the government. Focuses include the promotion of diversity within the entrepreneurial community, job providers in deprived areas and technology-based businesses. They do come with strings attached though. Most will require you to have been trading for a period of time and require lengthy application processes. They may also only part-fund projects or have strict qualification criteria. If you want to find out more about schemes available in your area, contact your local growth hub, and they will be able to advise.

Product-based businesses with a good social media following usually do well on crowdfunding websites


There are many platforms where businesses can now ask for donations to help them fund their business. As mentioned, product-based businesses with a good social media following usually do well on crowdfunding websites. You will need to give a token back to everyone that donates, which will usually increase in value the more they put in. You will have to pitch and provide information about the business to be accepted onto a crowdfunding website, and if the target you set is not met, you will have to return all of the money.

Asset Funding

This type of finance requires the business to have assets on the balance sheet that can be used to raise capital. These assets can include stock, machinery, equipment or outstanding invoices. You are more likely to get this loan quickly as the lender has collateral they can repossess if you default on the loan, however valuations can be lower than if you sold assets yourself.


When starting a business, the feeling of overwhelm is very real. It all comes back to having a well-informed plan. Using data analysis, forecasting and carefully considering what outcomes you want will lead you to the correct source of funding. Continue to test and assess whilst in the early days to figure out what works in the real world. If you’re unsure what the best option is for you, our financial experts are on hand to guide you through the process. To find out more about our free, no-obligation ‘Access to Finance’ consultations, click here.


The first step when starting out is to draw up a budget. It will help you decide how much you need, so you ask for the right amount and maximise your chances of getting it.

Short-term borrowing is an option worth considering if your funding needs do not need much time. This can include invoice financing or short-term personal loans.

Long-term borrowing is useful if you need a larger amount of money. This can include bank financing, alternative debt financing, start-up loans, investments, and crowdfunding.

Before you seek financing, it is important to be prepared, and this includes having the right documents, like Annual Statutory Accounts, Management Accounts, Profit and Loss Account, Balance Sheet, Cash Flow Forecast, and Personal Assets & Liabilities Statement.

Ways of financing your business can range from personal investment, money from friends and family, external investors, business loans, business grants, crowdfunding and asset funding.

Registering a Business Name in the UK: The Ultimate Guide

Registering a Business Name in the UK

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There are many benefits to registering your business name and a few different options available to business owners looking to maximise this important asset. have been helping budding entrepreneurs set up and protect their businesses for over 37 years. In this article, we’ll outline how to pick the perfect name, why you should register it and which protection is best for your situation and type of business.

How to Pick Your Business Name

As intellectual property (IP) protection and business set-up specialists, we understand how valuable a strong business name can be to the success of your venture. Some entrepreneurs have picked a name before they’ve chosen what the company will do, but others struggle with the decision. Over the years, we have registered thousands of business names and know the common pitfalls. In this section, we’ll outline what laws you need to be aware of, vital research to undergo and how the different types of brand protection should affect your decision process.

Are there any rules when naming my business?

Yes, there are laws in place in the UK to prevent offensive or misleading names from being used.

  • Words that make your business sound like it is affiliated with the UK government or an official body cannot be used, for example, ‘British’, ‘National’, or ‘Parliament’. This is designed to prevent companies from marketing themselves as a governing body or influencing customers to buy because they believe it is a legal requirement for them to do so. Permissions can be applied for, but it is at the relative authorities’ discretion whether you will be allowed to use these words or not.
  • Similarly, you can’t include a word that would be used to denote a status, like ‘charity’ or ‘trust’, unless you have officially registered as such.
  • Restrictions also apply for accredited professions requiring a qualification, such as ‘Solicitors‘ or ‘Patent Agents’.
  • Finally, there are regulations to hinder offensive names from being registered. This is one to watch if you are choosing a pun name for your business.

Test Your Business Name

Ask friends, family and colleagues about your potential business name to gain some insight into how potential customers might receive it. Listen to people’s feedback objectively, especially if they are your target audience. They may notice something that you haven’t. A good way to break it down is by doing the ‘Hear/Speak/See’ test.

  • Hear – your name needs to be easy to understand and have a memorable element to make it stick in people’s heads.
  • Speak – it needs to be simple to say and have a nice flow to the words. If folk enjoy saying the name, they will enjoy telling people about it.
  • See – does it work visually? This will play into your branding and logo design.
register business name


Registered Name vs Trading Name

The main benefit of forming a company is that you limit your personal liability.

When setting up your business, you may wish to form a limited company with Companies House in the UK. The main benefit of forming a company is that you limit your personal liability, so your personal assets are not jeopardised if the venture runs up debts. However, limited businesses do require slightly more paperwork and administration than being a sole trader. To find out which is best for you, please read our article comparing both here. No two businesses with the same name can be registered with Companies House, so you will first need to check if your chosen name is available. You also do not need to ‘trade’ under the name you have registered with HMRC. This means that your business can have a limited name. For example, ‘National Business Register Group Limited’ is our company name, but we operate under the brand name ‘’. It’s an important distinction to make if you are going to set up a business with multiple brands underneath it. These brand names will still be subject to intellectual property law, so it’s worth checking them out to ensure you aren’t infringing on anyone else’s current IP.

Why Should You Register Your Business Name?

Registering and protecting your business name from the start is the best way to ensure there are no IP issues further down the line. However, we appreciate this isn’t always how it works. If you have been trading for a while with no IP protection, we advise getting in touch with an expert to evaluate and advise on the best way forward.

Protect the Brand You’re Building

he most immediate benefit of registering your business name is that you are taking proactive steps to protect your name from being copied. However, simply registering your company may not be the whole story. Many forms of IP protection need to be applied for separately to ensure you are fully covered and reap the most from your hard work. Companies can register at Companies House with confusingly similar names and benefit from your reputation. Similarly, if you have no IP protection in place, persuading another company to change its name or branding can be a long and expensive process.

Enhances Your Reputation

Having a trade mark or other form of IP protection adds prestige and validity to your business.

Having a trade mark or other form of IP protection adds prestige and validity to your business in the eyes of customers, employees, suppliers and other stakeholders. It also gives you peace of mind that when you’re building your brand, you won’t need to change it further down the line if someone disputes your IP ownership. IP protection also acts as a fantastic deterrent to potential copycats.

Future-proofing Your Business

Whatever your entrepreneurial goals are with your business, having a solid foundation is key to growing a thriving company. No venture is without risk; however, preventing legal battles and disputes over branding, business names, or logos is a great way to avoid costly problems down the road. Also, when it comes time to seek investment or sell the business, your brand will become one, if not the most, valuable asset the business owns.

How to Register Your Business Name in the UK

You’ve trusted the process and come up with the perfect name for your business. What is the best way to register it? This depends on a few factors. The main factor will be what status your business has and how much budget you have available. In this section, we’ll detail the three most common ways to register and protect your business name within the UK.

Business Name Registration (BNR) from

BNR is a unique service from and the National Business Register that protects your business name from ‘Passing Off’. The common law of ‘Passing Off’ stands to protect a trader’s goodwill and business against copying. Anyone can bring an action of ‘Passing Off’; however, with BNR, all representation, administration and legal fees up to £10,000 are covered. Business Name Registration is ideal for sole traders, limited companies and freelancers looking to protect their name and reputation. Find out how you can be protected for £100 per year here.

Forming a Limited Company

In the UK, you can register a business with Companies House, preventing anyone else from forming a limited company with exactly the same name. However, this doesn’t stop companies with similar names from registering. Seeking advice from a formation agent is advisable, as well as conducting some research into your competitors’ trading names.

Register a Trade Mark

Trade marks are something that customers recognise and associate with your good reputation.

A trade mark is a type of Intellectual Property (IP) connected with a particular company, product or service. Trade marks are something that customers recognise and associate with your good reputation and the quality of your product or service. These could be words, names, logos or designs. To register a trade mark in the UK, you have to make an application to the Intellectual Property Office (IPO). The process takes around 5 months, and your mark can be objected to and denied with no refund. We would always advise consulting an IP expert when applying to register a trade mark. They will be able to fill out the forms, advise on the likelihood of registration and defend your application against objections. are trade mark specialists and have successfully registered thousands of marks for business owners, find out more here.


There are a few different ways to register your business in the UK. The best option for you depends on how you plan to run your company and what level of protection you need. Registering your business and your IP not only protects your business from imitation but also adds integrity, prestige and value–authenticating a brand’s identity. We would always recommend seeking professional advice when setting up your business to ensure your company is compliant and properly registered. This will put in place a solid foundation from which you can grow your business.


  • When picking a business name, you have to adhere to a set of UK laws that do not allow for offensive or misleading names.
  • Before putting your business name out, it is always recommended to first test it and see how it is received. Asking a friend, family or colleague can help. Feedback lets you determine if your name is easy to understand, simple to say, and looks good.
  • There is a difference between a registered name and a trading name. The registered name is for official purposes, whereas the trading name is used for business.
  • Registering your business name comes with many benefits. The most immediate benefit is you protect your name against copying.
  • Registering the business name also adds prestige and validity to your business in the eyes of the customer. Moreover, it future-proofs your business by reducing the likelihood of potential legal battles and disputes.
  • Business Name Registration (BNR) is a service from Start.Biz and the National Business Register that protects your business name.
  • In the UK, you can register a business with Companies House and thus prevent others from using the exact same name as yours.
  • To register a trade mark in the UK, you have to make an application to the Intellectual Property Office (IPO)