As the country continues to try to find its feet following the historic vote to leave the European Union, new opportunities within the finance world are presenting themselves to both investors and borrowers. Although this is arguably a complicated time to rely on the banks for business loans, the possibilities that crowdfunding can provide in terms of lending are far more promising. Additionally, the best investment options can arguably be found via crowdfunding platforms at this time.
Brexit is set to change the game for SME’s within the United Kingdom, with the potential for local expansion and international growth being prevalent at this current time. In this article we are going to explore why this is the case and how you as a business owner can use this situation to your advantage.
Equity crowdfunding, which involves investing in a company in exchange for shares in that company, is booming following the European Union referendum. Investments in British businesses post-Brexit are up 18% (Business Insider UK), which demonstrates how investors are keen to continue supporting British entrepreneurship.
During 2015 the alternative finance scene in the United Kingdom was responsible for £3.2 billion of investment finance into British start-ups and SME’s (City A.M). This figure speaks for itself in regards to how essential crowdfunding has become in supporting the future of businesses in the United Kingdom. Far from being a reason to stem this trend, there is every expectation that crowdfunding will continue to grow in popularity in the coming years.
Before the referendum took place there was much speculation as to whether a vote to leave would cause a down-turn in the investment world. It was suggested that uncertainty would cause investors to be more cautious with their decisions to spend, meaning that those investments deemed to be more risky would lose out. However, massive amounts of investment money into the UK that were delayed in the period preceding the referendum have now began flowing into the country. Approximately £6 billion of investments were delayed due to the results. £1.8 billion of that investment amount is predicted to now materialise in the United Kingdom, with the rest to potentially follow at a later date, which would give the economy a boost in the third quarter of the year.
As the uncertainty surrounding the future of the United Kingdom continues, it is expected that funding shortages will exist within traditional financing options, such as the banks. This means that alternative financing will become more popular, both in terms of those looking to invest and those looking to borrow.
It is still not completely certain what a post-EU United Kingdom will look like, both politically and financially. However, it is certain that the claims of foreign and British investment drying up were exaggerated to say the least. Before the vote took place, several prominent figures were quick to forecast negativity in relation to the future of the British economy.
“A UK exit from the EU would reverse the trend towards greater global trade and investment, and the jobs they create, and is a further serious risk to growth” - A declaration from G7 leaders at the 2016 G7 summit in Ishe-Shima.
Making the choice to become an investor with Go2 Business Loans at this time is a great option and you can do so by clicking here. Similarly, the time to register as a borrower to find the finance you need to start or expand your business is now!
This is peer to peer lending and your investment is at risk. We encourage investors to diversify their portfolio and to review all investments to ensure that they meet with their own investment criteria.