KPMG Study Reveals That Family Businesses Are Seeking External Investment

Report Highlights Role Of Alternative Funding Sources

09.09.2014

David Shirt, Press Officer | 0161 838 3094

According to research by KPMG, over half of family-owned businesses are seeking new investment to fund growth plans.

The report also highlighted that a third of companies are considering alternative sources of finance as they perceive that the economic climate has impacted their ability to fund projects through traditional bank loans.

Private equity and venture capital was ranked as the preferred source of external funding, however the report pointed to role that high-net-worth individuals could play in funding family businesses

Will Baker from KPMG said: "The issue of maintaining control and independence certainly imposes limits on the possible routes for family business financing.

"This means many family businesses across the UK are treading a fine line between successfully attracting funding, and monitoring the impact this may have on the family's control of the business – something which could be limiting their growth potential.

"There is a potential alignment of interests between the high-net-worth individuals/family office and family business groups and certainly experience to be shared as many of the potential investors have been involved with their own family business.

"This knowledge – and potential finance – could be valuable in enabling many businesses to explore their growth potential."

Andrea Cropley, Corporate Partner at Irwin Mitchell said:

Expert Opinion
This survey reveals some interesting findings in relation to access to finance. We’ve certainly noticed that the entrepreneurial community are increasingly open to less traditional forms of financing and there are certainly opportunities for ambitious family firms also.”
Andrea Cropley, Partner

Later this month, Irwin Mitchell will host a debate on alternative forms of funding and in particular explore angel investment opportunities and the increasing popularity of crowdfunding platforms.

The free event  at the Memorial Hall at Sheffield City Hall takes place on 25 September and includes an expert panel with Michael Wilkinson from Crowdcube and David Belford, an angel investor and Chairman at Konnectiv Technology Ltd. They will be joined by Scott Haughton from Envestors,  Rob Passmore, the founder of online retailer Jewel Street, Chris Sellars, who is Director at Mackenzie Spencer and Nick Moules from the Rebuilding Society.

Andrea added:

Expert Opinion
Access to funding is always high on any list of issues facing all successful and ambitious companies. We wanted to host an event which explored the issues and examined some of the misconceptions and prejudices about particular forms of funding.”
Andrea Cropley, Partner

For further information and to register for Irwin Mitchell’s free event about alternative forms of fundraising please click here.