Alexander Allen
UK Managing Director, Funding Circle
Small businesses are vital to the UK economy. If they are resilient, adaptable and have access to the right funding, they will be able to survive and thrive in challenging times.
Don’t underestimate the adaptability and importance of Britain’s small and medium enterprises (SMEs), insists Alexander Allen, UK Managing Director of leading small business lending platform, Funding Circle.
SMEs seize business growth opportunities
“We can’t shout loudly enough about SMEs,” he says. “The average small business we talk to consists of 8 to 10 people and has a turnover of £1 million. The loans we gave SMEs in 2022 generated £6.9 billion in GDP, supported more than 106,000 jobs and generated £1.4 billion in tax. Small businesses are crucial for their communities and the wider economy.”
The last few years have — to put it mildly — been a testing time for small businesses, but Allen never ceases to marvel at their inventiveness and flexibility. It’s a quality he sees in all customers at Funding Circle. “They’ve had to deal with the pandemic, the cost of living crisis, soaring inflation and supply chain challenges,” he says. “SMEs have pivoted, adapted and done things like move online or change their product portfolio.”
Despite the pressures they face, our research shows that 74% of SME leaders say they would recommend starting a small business.
Support for small businesses in a difficult economic climate
There are three elements to small business resilience, says Allen: financial resilience, operational resilience and personal resilience. “Financially, SMEs need access to capital so that they can respond to the unexpected. They then need operational resilience — flexibility and agility — to be able to react quickly. Finally, their leaders need personal resilience — a determination to keep their business working under any circumstances. It’s why thriving SMEs have a focus on good mental health and wellbeing.”
Even the best small businesses can be buffeted by economic headwinds, so finding the right funding for their specific needs is key. “Cashflow is one of the main challenges facing SMEs,” says Allen. “In the current climate, we’re seeing strong demand for our services, so we’re expanding our product range and recently introduced FlexiPay to fulfil SMEs’ needs for short-term finance, because we know that small businesses sometimes need more than a term loan. We have to be able to offer them other options.”
“It’s a tough environment out there, but I know that CEOs of small businesses are optimists who are always looking for opportunity,” adds Allen. “Despite the pressures they face, our research shows that 74% of SME leaders say they would recommend starting a small business. So, where there are growth opportunities, the small businesses of Britain will find them.”
For more information, visit fundingcircle.com
