Defined Wine

How to start or grow a new business

What are the best ways to raise finance for a start up?

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business valuation
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year on year growth in turnover
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increase on forecasted profit

The Challenge

To obtain investment and funding as a startup can be tricky.

The problem you have is that the new business has little or no trading history to raise loan finance for example, so you need to focus on raising investment and have a business opportunity that would be attractive to investors.

If successful in raising funding for your startup, you will likely need to report quarterly to investors, so solid financial foundations and systems are just as important.

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The Approach

Investors will want tax efficient investing to make the opportunity as attractive as possible.

The startup can apply for the company (in most instances) to become part of SEIS and EIS, which is one of the most important tax breaks to attract investors. The company will receive cash in exchange for shares in the new business and the investor will save tax directly from their tax bill.

SEIS and EIS won’t be enough just on their own though. Investors will want to be confident that the new business can provide them with a return in the future.

They will want to make sure the finance function is robust, can produce accurate forecasts for growth of the business, can realistically forecast cash flow and have confidence that the operations of the business remain strong as the business scales.

There may also be some opportunities for the business to apply for certain grants to help get your startup up and running too.

Forecasting profit, cash and business value allowed the directors to confidently present their business opportunity to investors, and succeed in getting investment.
Utilising the expertise and skill sets of different professionals proved invaluable in bringing the proposal presentation together
As a cash-intensive startup, obtaining cash at the beginning meant that equipment, machinery and a skilled team could be put together quickly to not cause delays
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The Outcome

The latest valuation of the business was over £10.1 million

The business has averaged year on year growth in turnover of > 120%

Forecast profit for next year is on track to supersede budget by 11%

“For all of this, the advice and experience of the team at OutRise was invaluable. Thank you Alan, Brent and all!”

Henry Sugden, CEO of Defined Wines

Defined Wine

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