So far in our blog series on business start-ups, we’ve looked at legal structures for new businesses and the main tax liabilities you need to know about when you first get started. In this final instalment, we’ll focus on sources of funding and finance for new businesses in Ireland.
Most start-ups need an injection of cash to get off the ground. Unless you have enough money of your own to put into the venture, it’s very likely that you will need to take out loans or find other sources of capital to cover the upfront costs of stock, premises, equipment etc.
The need for finance is not a one-off thing, either. At any stage of a business’s existence, reaching the next phase of growth can depend on having capital to invest, whether it’s to upgrade premises, infrastructure and technology, expand and upskill your staff or anything else.
Here are some of the best sources of finance for start-ups and SMEs in Ireland.
Local Enterprise Office
The first place to look for start-up funding is your Local Enterprise Office. There are 31 across Ireland, offering a range of SME-focused business support. This includes providing access to Feasibility Study Grants to help you research the market for a new business venture, and Priming Grants for helping with start-up costs. Established businesses can also apply for Business Expansion Grants.
All grants available via Local Enterprise Offices are aimed at microbusinesses, meaning they are only available to firms with 10 employees or fewer. They are all also part-funded, meaning they pay up to 50% of the overall investment, with the rest having to come from other sources. Feasibility grants are capped at €15,000, priming and expansion grants at €150,000.
Microfinance Ireland
Grants are beneficial in the sense that they don’t have to be paid back. But they come with a range of conditions and depend on you having other sources of capital to contribute to the investment.
Loans accrue interest, but they come with a lot more freedom in terms of how the money is used. You can seek business start-up and development loans through high street providers. But some of the best value loan products are available through Microfinance Ireland (MFI). MFI specialises in loans to SMEs of between €2,000 and €25,000, with typical three year terms. You can also get a 1% discount on the APR Rate if you apply for a loan through your Local Enterprise Office.
Enterprise Ireland
For larger companies (i.e. any organisation with 10 or more employees), one of the best resources for accessing business capital is Enterprise Ireland. Part of the Department for Enterprise, Trade and Employment, Enterprise Ireland is the government agency responsible for nurturing innovation and growth at home, and promoting Irish enterprise overseas.
Enterprise Ireland provides access to a wide range of grants and equity schemes linked to business development areas such as digitisation, sustainability and employment, as well as general capital funding support. It also has to sign off on any grants awarded by Local Enterprise Offices that total more than €50,000.
Speak to an expert
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