Every week, I speak to founders convinced the market has failed them.

No appetite. No lenders. No money available.

They think that the system is stacked against businesses like theirs.

I find that slightly baffling.

Because I’ve worked in capital markets across the US, UAE, Australia, Russia and Tajikistan. I’ve seen what a genuinely broken market looks like - where the money simply isn’t there, where solid businesses are building in near-total financial darkness because capital barely exists.

The UK is not like that in the slightest. Not even in the same postcode.

And yet, one of the most persistent myths in the SME space is that there’s no money available. 

There is. Enormous amounts of it. 

I sometimes want to grab people by the shoulders and spell it out: the unit economics are simple. There is more capital available to UK SMEs than at almost any point in history. The businesses are there. The lenders are there. And yet they keep missing each other, which means the problem has nothing to do with supply.

The issue is TIMING. Founders are looking for the right deal at the wrong moment.

1/ The UK lends £80 billion a year to SMEs. The market is not broken.

2/ The worst time to look for money is when you need it.

3/ Your capital structure probably doesn't fit your business anymore, and nobody's telling you that.

4/ More lenders, more schemes, more government initiatives. None of it addresses the actual problem.

The UK lends north of £80 billion a year to SMEs through debt alone. Equity adds another £10 billion on top. High street bank lending rose 14% year-on-year in Q1 2025. Challenger and specialist banks have doubled their share of SME lending over the last decade. There are more routes to capital available to a UK SME right now than at any point in history. 

And still. Nearly 43% of UK SMEs failed to access external finance in the first half of 2024 - businesses with solid revenues, clear growth plans and healthy repayment histories. The capital went up. The uptake went down. Something is going wrong before businesses ever reach the market, and the entire ecosystem is merrily ignoring it. 

Initially, when I launched FundOnion, I was under the assumption that access was the problem. More lenders, more options, better connections - outcomes would follow. Logical. Neat. It took me a few years of watching the data to realise it wasn't quite right. 

The businesses getting the best outcomes weren't the ones with the most options in front of them. They showed up at the right moment, in good shape, with no deadline making them sweat. The platform wasn't the variable.

Timing and preparation were the variables. Every single time.

Meanwhile, the government keeps funding new schemes. The BBB keeps expanding. New platforms keep launching. Everyone is treating this like a supply problem. The supply is fine. Has been for a while, actually.

I know, radical concept. But founders only tend to think seriously about finance when something has gone wrong, or when growth is pressing and cash is getting thin. 

By that point, every lender is staring at a stressed balance sheet and pricing it accordingly. If things are going well right now - good. Use that. Have the conversation while you have something worth showing.

Most people find out what their application looks like when it comes back rejected with no explanation and no obvious next step. Sit down with your accountant, go through the numbers honestly and find the gaps before a lender does. 

Sounds obvious, yet the majority of people skip this part entirely.

Seriously, when did you last look at it? Most businesses set up financing early and leave it completely alone. What worked in year one probably doesn't fit a business in year four. The revenue has changed, the risk has changed, the needs have changed - and there's a decent chance the debt sitting on the books is the wrong type entirely. 

Asset finance, invoice finance, a revolving facility - options that might suit the business far better than whatever was signed in a rush three years ago. 

Nobody flags this unprompted. That's just the reality of the market.

More schemes, more lenders, better rates eventually - it's a reasonable thing to hope for and a poor strategy to depend on. The businesses that raise well aren't waiting for a perfect environment.

Prepared, good timing, easy to say yes to. That's the whole formula, more or less.

£80 billion a year is pretty hard to argue with. The issue isn’t whether capital exists; it’s whether businesses are even ready for it.

The problem (and I say this with affection for every founder I've ever had this conversation with) is almost always on the other side of the table. Too late, underprepared, wrong capital structure, wrong moment.

Sort those things out. The market looks very different when you do.

If you want to know exactly where your business stands before your next funding conversation - reply to this email with the word READY, and I'll send you the five questions every lender will ask, and how to make sure your answers land the right way.

Till next time,

James