The Turnaround Finance Blog

We all need a little extra help sometimes – even some of the biggest banks in the world have had to raise business finance in 2008. But where do SME’s turn when the going gets tough and additional capital is needed to re-build their depleted balance sheet? This is where Beer & Young can be the answer.  Since 1998 Beer & Young has been acting for undercapitalised SME’s who have often reached a critical point in their banking relationship. Beer & Young is focused on investor backed recovery solutions – the typical Beer & Young investor will be an experienced ‘Business Angel’ willing to invest in a turnaround situation or simply where urgent funding is required.  Beer & Young is delighted to have forged close working relationships with many relationship managers across the banking community. Some, but not all, operate within the business support/special situations departments of the bank. The common characteristics of the accounts that are being managed tend to be: 

• Profitability has deteriorated and/or losses are accumulating
• Liquidity is poor and the bank facilities are increasingly ‘hardcore’
• Gearing has reached a tipping point where the bank is no longer comfortable

The above could be described as the ‘hard issues’, but financial ‘fire fighting’ takes an inordinate toll on business owners in terms of emotional energy and commitment. The old adage of ‘trying to see the wood for the trees’ is often very pertinent. This is an area where the hands on help and experience of a Business Angel investor can be invaluable. We all know about the problems that the global credit crunch has caused, but this has not affected the investor appetite for SME opportunities. Business Angels will make their own decisions as to how and when they invest – they see investing in businesses that have been successful in the past as far less risky than early stage/start-up situations.   This is a counter cyclical market, where there is increased liquidity for turnaround/distressed opportunities. The upside for bank relationship managers is that there is access to ‘Business Angel’ funding for SME’s via specialist firms such as Beer & Young.  We are always pleased to talk to bankers to explain our services more fully and listen to the views of front line lending managers. Please contact our London offices on 0207 329 6886 to arrange a convenient appointment – please ask for Kylie van den Berg (kylie@beerandyoung.com),