If you’re an experienced recruiter interested in starting your own business, access to the cash required to support you through the launch period can be a stumbling block.
But it doesn’t need to be, with accessible and attractive ways to fund your business launch making it easier than ever for talented recruiters to get started in entrepreneurship.
You don’t need to sink your life savings into your venture, you don’t need to put yourself and your family under massive financial strain, and you don’t need to give away huge chunks of equity to investors.
What are my options?
Most start-ups that are supported by some form of outside funding use either debt or equity financing.
This means, in simple English, either borrowing money (in the form of a loan, with an obligation to pay it back), or selling a portion of the equity in the company (shares) to investors.
The amount of money you’ll need to borrow will depend on a combination of factors:
- How much you need to cover your monthly living expenses
- How long you forecast it will take for your company to start receiving payment from clients
- How much you have available in savings to contribute to your expenses during this period
- The company’s costs during this ramp-up period
RecruitHub works with founders to assess and model these factors, arriving at a calculation of how much cash a new business needs to launch securely.
What can I expect?
Once we’ve modelled your start-up’s cash needs, we’ll walk you through the options to plug any gap between your available savings and your capital requirements.
For many new agencies, there is no gap – founders have enough saved away to comfortably get them off the ground.
For others, some help is needed, which could come in the form of a bank loan, cash from investors (equity financing), or even a loan from friends, family or contacts who would be interested in investing in your new business.
In all instances, RecruitHub works to find a solution where you as the founder are the clear majority shareholder in your company, even if investors pay your salary for the initial trading period.
In most cases, founders taking investment need significantly less than they anticipated to launch their companies (usually £15 – £50,000, higher for those planning on scaling rapidly), and own much more of the equity than they had expected (80-95%).
What do I need to do?
The first step in any financial planning process is to build the initial forecasts.
RecruitHub works collaboratively with founders to create financial models, and doesn’t expect first-time business owners to present a detailed business plan.
Instead, well guide you through the process of calculating your financial needs, then help you to work it into a compelling proposition that investors would be keen to get involved with.
Having a strong, professionally-built set of documents for investor review is a critical part of ensuring your start-up receives an attractive valuation, leaving you owning a greater portion of the shares after investment.
How do I get started?
All discussions begin with an open exploratory conversation, aiming to understand if launching your own venture is the right move for you.
From here, we work to understand the focus, scope and complexity of your planned venture, while beginning to form a picture of the potential capital needs.
Lastly, we’ll walk you through a detailed process to create a bespoke business model, giving you a clear picture of what starting up looks like from a financial angle, and forecasting your personal earnings in years 1-5 of running the company.
