Start Up Loans Delivers over £30m to Small Businesses in Scotland

Entrepreneurship in Scotland is on the rise, according to new figures from the British Business Bank’s Start Up Loans programme, published today.

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They reveal that the government-backed scheme has lent more than £30m to small businesses in Scotland since it was launched in 2012, £3.5m (13%) higher than in March this year.

In total, the scheme has issued more than 4,000 loans, with an average loan size of £7,462, to help people in Scotland become their own boss.

Of the 4,047 loans issued to aspiring business owners, 35% went to women. Among them was Victoria Nicol, who took out a £10,000 loan in 2017 to grow My Language Connection Ltd (MLC), a specialist technology translation agency in Glasgow, to the next level.

Victoria had always loved using her sales and marketing skills to help clients at the translation agency where she worked for several years. With the benefit of that experience she identified a gap in the market for a more specialised form of translation to help Scottish businesses navigate more technical vocabulary and MLC was born.

With the help of the fixed-interest loan provided by Start Up Loans, Victoria was able to pay for new software which enabled her to save time and money by managing her clients’ projects more efficiently across a network of 400 specialist translators globally. The loan also enabled her to invest in business development missions, which helped her to win new contracts with her main clients.

The business now generates an annual turnover of £178,000 and Victoria employs three full-time members of staff and engages with a sub-contracting network that employs 400 linguists.

As a result of this success, Victoria has been nominated for Business Woman of the Year at this year’s Scottish Women’s Awards.

The Start Up Loans scheme provides fixed-interest loans of up to £25,000 to aspiring business owners in every part of the country. Since 2012, it has lent £527 million through 66,435 loans to people from a range of backgrounds and ethnicities.

Through a network of delivery partners, the scheme also provides pre-application support with business plans and cash flow forecasts and free mentoring to help businesses get into the best possible position to succeed.

Victoria Nicol, the founder of My Language Connection Ltd, said: “I’ve always had a passion for business and startups after graduating with a BA (Hons) in Management, Technology and Enterprise but felt limited in my previous role. Start Up Loans, through its funding, helped me greatly, to drive my business and passion to the next level. I wholeheartedly love what I do and find being a business owner incredibly rewarding.”

Richard Bearman, Managing Director of Start Up Loans, said: “Small businesses are crucially important to our economy, helping to create jobs and generate income, and we’re dedicated to helping them thrive. Knowing that Start Up Loans plays a crucial part in the success of businesses such as My Language Connection is fantastic.”

Damian Baetens, Business Support Director for delivery partner Transmit Start-Ups, said: “Businesses like My Language Connection simply wouldn’t be able to get established without access to schemes like Start Up Loans, and the help and support which our advisers provide. We’re very proud to have been part of Victoria’s story; success stories like this are why we have a team dedicated to providing this support across Scotland.”

Small Business Minister Kelly Tolhurst said: “Stories like Victoria’s are exactly what the Start Up Loans programme is about: supporting thousands of entrepreneurs across the UK to form new businesses, grow their local economies and be at the heart of their community.

As a former small business owner, I understand how important access to finance is for small businesses to plan, invest and grow – including seizing the opportunities of scaling up in new markets after our departure from the EU. I am proud that the UK government has helped so many businesses to do just that.”

UK Government Minister for Scotland Robin Walker said: “Scotland is home to many small businesses which lead the way in terms of entrepreneurship and innovation. I am pleased to see £30 million issued to entrepreneurs across Scotland through the UK Government-backed Start Up Loans scheme. We must continue to foster home-grown talent and back entrepreneurs to ensure Scotland’s economy thrives.”

Breakdown of loans by region (as of August 2019)

Key Statistics

Figures in this release are drawn from data on delivery of loans up to 15 July 2019, when the programme passed the £510m mark.

* Since 2012, the Start Up Loans scheme has delivered more than 65,000 loans, providing more than £510m of funding.

* In the financial year 2018/19, the scheme provided 7,869 loans with a total value of approximately £83m – helping to support around 22 businesses every day of the year.

* Since 2012, 36% of loan recipients were formerly unemployed or economically inactive.

* Since 2012, 16% of loan recipients were aged between 18 and 24.

* the 2014 cohort (of 11,000 loans drawn down over November 2013-December 2014) will generate a net Gross Value Add (GVA) of £169m by 2019/20; and some of the 2016 cohort (the approximately 3,450 loans drawn down over January-June 2016) will generate a net GVA of £85m by 2021/22.

* Loan recipients report estimated average turnover of £42,000 in the first year after they have drawn their loan down.

* In the November Budget 2018, the Chancellor announced that the programme would be extended, with a target of 10,000 additional loans being issued in the year to April 2021.

For more information about Start Up Loans, please visit: https://www.startuploans.co.uk/

All of these statistics are gross estimates, with the exception of the return on investment numbers, and are based upon Start Up Loans CRM and externally commissioned research undertaken by SQW Ltd, with support from BMG Research.

 

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