Left: Our introductory video launched in April 2018; and Right: About our clients video launched November 2018.
As I sprint past my first anniversary of joining the Liquidity Club I pause for breath to reflect on what I and the Liquidity Club have been up to.
I remember my first day well, walking into the Finance 4 Business' brand new offices and being paraded around trying to remember all the names presented to me. Sitting at my desk, I broke the spine of a crisp new note pad and that was that – time to support the growth of Liquidity Club.
How it unfolded
The concept, ‘an outsourced sales team’, is how we disrupt the market; working closely with a small selection of business finance funders who we felt fit with our values and the needs of businesses. The concept was formed, and it was time to find these finance providers the right funding opportunities.
I jumped in my car, took many trains, made countless calls, talked to loads of businesses, to my introducers, learnt all about the world of social media and then we made a video that is yet to go viral (see above), but I have total confidence! What was clear from early on was business’ were looking to raise finance but other than speaking to their bank they didn’t know where to start (as Will Mason reported in his blog earlier this year).
Pleasingly (and thank you to everyone that has supported me) the opportunities came in thick and fast and the results have exceeded expectations. We’ve secured cashflow solutions to include refinance, new finance, acquisition & transactional debt, growth and turnaround all for a variety of situations.
Liquidity Club is not standing still. We have invested in our people and are up to a team of seven, bolstering our analytics team, launching in the North West and now London and the South. Everyone believes in our core value ‘Pragmatism’ - we are pragmatic in everything we do, approachable, straight talking and lateral thinking.
It’s good to stop and pause for breath and reflect but not for too long as there are businesses that require finance and funders willing to support them, it’s time to kick on!
Asset based lending to businesses in the UK has grown 2% year on year in Q3 2018.
Stephen Pegge, Managing Director of UK Finance said: "Asset based lending continues to show steady growth, driven mainly by advances to larger businesses. Support to small and medium-sized companies through invoice finance and asset based lending is now comparable to total balances drawn on overdrafts."
"However, overall growth has remained modest in line with recent trends across SME lending, as businesses delay investment decisions until the broader economic picture becomes more certain.""
Liquidity Club has arranged and advised a seven figure Asset Based Lending (ABL) facility for Penistone business AD Bird Stainless Limited. Liquidity Club worked with Wyelands Bank who acted as funders on the deal.
A family-run business, AD Bird Stainless Limited was established in 1987 and has quickly built up a reputation for the fast, efficient and reliable supply of quality, specialist, stainless steel products and services. The business employs 23 staff from its headquarters on Sheffield Road in Penistone and is forecast to achieve over £7million turnover this next financial year, which demonstrates substantial growth over the previous year. It works with a wide range of industries including nuclear power generation, oil and gas, water, marine, petro-chemical, architectural, automotive, construction and general engineering.
The ABL facility was structured by Ian Flaxman at Wyelands Bank, who worked with Adam Simpson at the Liquidity Club to tailor a finance package to support AD Bird Stainless Limited’s growth strategy. The ABL line is a revolving facility that works by accessing cash held within the debtor book and assets, thereby giving AD Bird Stainless Limited access to working capital to assist future growth.
The business is today run by the second family generation of Nigel Bird, Managing Director, and son of founder Derek Bird.
Nigel Bird, Managing Director at AD Bird Stainless Limited said: “The funding is a very important driver in our growth and allows us to manage our future plans. We are extremely busy with new orders and supporting existing customers, both in the UK and overseas, and I am excited to have the financial backing to invest for the future. This year we are on track to hit our forecast turnover which has been assisted by our increased focus in the marine sector. The support provided by Adam Simpson at Liquidity Club throughout the process has been great, he has really understood our business and our growth strategy.”
Ian Flaxman, Managing Director, Working Capital Solutions at Wyelands Bank, said: “At Wyelands Bank, we were set up to help businesses just like AD Bird Stainless Limited to trade, grow and create jobs. By supporting small and medium firms, providing the business finance they need to trade effectively, we fill a vital gap in the market. We give customers direct access to decision makers and work together to find the right funding solution for them, as this deal with AD Bird Stainless Limited demonstrates.”
Liquidity Club has expanded its team with the appointment of Tim Corbett to lead the firm’s expansion into London and the South East.
Liquidity Club has expanded its team in the North of England with the appointment of Chris Carter as the Regional Director for the North West region.
Chris’ appointment highlights the successful growth of Liquidity Club which was launched a year ago as an alternative business channel for business funders to assist SME’s looking to raise finance to support growth and present impartial financial solutions that are tailored to suit each individual business.
Chris will concentrate across the North West region including Manchester and will work alongside colleagues in the Birmingham and Leeds teams. Chris has extensive experience in the banking and financial services sector having recently worked for Mercia Fund Managers and prior to that the Royal Bank of Scotland and NatWest.
Recently published statistics indicate that only 34% of SMEs are using external finance, while only 47% are planning to grow in the coming 12 months. Could this indicate that SMEs are lacking the funding to expand? Or could it be that SMEs are lacking information regarding how debt finance could benefit their business?
Those SMEs who have borrowed in the last 12 months have generally used finance for expansion (29%), working capital (28%) or purchasing capital equipment (22%). In addition, around 2 in 3 of these borrowers have used finance provided by their main bank. 85% of SMEs are using finance provided by a company with whom they have an existing relationship, whether a bank or another provider. Contrary to the common media rhetoric, only 12% are being declined when applying - a real positive message.
One concern amongst the statistics is that only 4 in 10 businesses are consulting a professional advisor or finance provider about funding. This can be so valuable in finding the right structure and cost of funds. At Liquidity Club we have seen numerous businesses able to release far more cash, or save money, when moving to new providers compared with their incumbent provider. Yet only 7% of SMEs, in the statistics, have moved to a new provider in the last year.
Perhaps this highlights the need for more information being made available to directors of SMEs. Equally, it may be that increasing choice of providers, complex terminology and the number of different products can be confusing for those directors of SMEs. For any who agree with these sentiments, we would welcome a conversation about debt funding to break down some of these barriers.
All statistics sourced from BVA BDRC:
At Liquidity Club Mariana will be responsible for working with the existing Liquidity Club team to generate new business and assist businesses across the UK who are seeking debt finance to support growth.
Mariana Bloomfield, Business Analyst at Liquidity Club said: “I am delighted to join the Liquidity Club. I was looking for a new challenge returning to the financial services sector and Liquidity club peaked my interest. I have joined a forward thinking and innovative team that is making a name for themselves within the commercial finance world. Liquidity Club offers an interesting proposition as they seek to simplify the funding process and present impartial financial solutions that have been tailored to suit each individual business.”
Flylolo, a flight operator specialising in purchasing seats on ‘peak season’ flights and selling them to individuals and families at reduced rates, is flying high following the granting of a revolving credit facility provided by Reward Finance Group, with the help of Liquidity Club who facilitated the transaction.
Typically operating from smaller regional airports, such as Southampton and flying to Greece and the Canaries, Flylolo buys aircraft seats in bulk, as soon as they are released, in order to obtain the best prices.
Complex Cash Flows
Parisa Lian of alternative SME funder, Reward Finance, who arranged the credit facility, recognised the challenge for the company.
“As the awareness and reputation of Flylolo has grown, so have sales of its lower priced ‘holiday season’ seats. To satisfy the growing demand, the company needed additional cash to buy increasing numbers of tickets early in the season. With a relatively long period from purchase to payment means the amount of tickets they can buy is restricted by the amount of cash available. As a proven and growing business we were keen to help Flylolo enjoy even greater success by plugging the working capital requirement until payment for the seats is received.”
Managing director of Flylolo, Steven Dendle, who has extensive experience of the travel and airline industry, is looking forward to building on its success.
“Every year we hear about families who have to pay inflated prices to go abroad during the school holidays, whether it is Easter, summer or Christmas. Therefore the principle of our business is straightforward. By purchasing seats on flights in bulk, when they are at their cheapest, we can pass some of these savings on to our customers. Parisa and Reward have been a real asset to our team. I have been impressed with the way the deal has been structured by using existing assets to leverage cash. The new credit facility has allowed us to take advantage of purchase opportunities which are crucial to our business.”
Liquidity Club has arranged and advised an eight figure Asset Based Lending (ABL) facility for Rotherham-based Hatfield Energy to support the firm’s fast growth.
Hatfield Energy are on track to reach its forecast group turnover of over £30million at the end of its financial year in October 2018. Liquidity Club worked with ABN AMRO Commercial Finance (ABN AMRO) who acted as funders on the deal.
Firmly established as a family owned, pioneering Yorkshire business, Hatfield Energy has been based in Rotherham for over 45 years. It has evolved at a fast pace offering bulk commodity supply into heavy industry with an ever-increasing portfolio of secondary and virgin raw materials. Operating from a six-acre site, Hatfield Energy can accept and process thousands of tonnes of select bulk materials and industrial wastes. Resourcing, recycling and reusing industrial wastes and by-products from heavy industry has been a core part of the business for the last 40 years.
The business is today run by the second family generation of brothers, Grant and Mark Hatfield and employs over 40 people. It boasts many awards having recently been recognised in Yorkshire’s Fastest 50 Awards in 2018 (Yorkshire Post/Ward Hadaway) and in 2014 won a coveted Queens Awards for Enterprise – Innovation.
The ABL facility will support Hatfield Energy’s growth strategy which includes further expansion of its portfolio of products and capabilities. The facility was facilitated by Adam Simpson from Liquidity Club and has been provided by AMB AMRO. It works by accessing cash held within the debtor book and inventory assets, thereby giving Hatfield Energy access to working capital to support future growth.
Austin Thorp, ABN AMRO Manchester Sales Director said: “ABN AMRO is delighted to be able to support Hatfield Energy with its continued growth trajectory - a long established business with a strong management team, which we are confident can deliver its plan. Working in conjunction with the Liquidity Club, Hatfield’s funding requirement was clearly identified, and a suitable funding solution provided to meet their growing business needs.”