Every business needs fuel. Whether you’re navigating a rocky period or planning your next phase of growth, finding the right funding can be critical to your business’s health.
For business owners, however, traditional loans from banks can feel out of reach — especially in today’s tighter lending climate.
Fortunately, you don’t need a bank to raise the money for your many needs! There’s a growing range of alternative funding options, designed to meet the needs of SMEs, and they’re often faster, more flexible, and better aligned with how modern businesses operate.
Here are five practical ways to fund your business without stepping into a bank branch – creative funding strategies for UK SMEs who need capital, without the paperwork and delays of traditional lenders.
Business Funding Advances: Fast, Flexible and Focused on Cash Flow
Business funding advances — also known as merchant cash advances or revenue-based finance — offer companies fast access to working capital, without the rigid structure of a traditional loan.
Traditional Bank Loan
When accessing traditional finance, typically you will have to stake significant collateral as a personal guarantee (e.g. your home).
Interest rates will continue to compound, meaning your repayment balance continues to grow, until you’ve fully paid your bank back.
And all of this is predicated on actually being eligible for funding!
With banks and traditional financiers drastically reducing their appetite for lending to UK businesses, many SMEs now find it impossible to access finance (and the process can often take months, even if eligible).
Business Funding Advance
Contrasting bank finance with business funding advances – such as those provided by alternative lenders, like Got Capital Business Funding – and you can typically access fast, unsecured funding, with a fixed repayment fee, pre-agreed from the outset.
This makes this type of business funding particularly well-suited to companies with steady revenue but not necessarily strong balance sheets or long trading histories.
Key benefits include:
- Rapid approval — often within 24 to 48 hours
- No need for assets or personal guarantees
- Repayments flex in line with your revenue
This kind of business funding can be especially useful for plugging short-term cash flow gaps, investing in stock ahead of peak trading periods, expanding premises, purchasing/replacing critical technology or machinery, or even launching a new product or service – without needing to jump through complex lending hoops.
If speed and simplicity matter — and you’ve got recurring income — this way of accessing funding for you business is worth a closer look.
Attracting Investors: Capital for Equity
If you’re aiming to scale and can demonstrate long-term potential, equity investment could be a route worth pursuing. In exchange for cash, investors receive a percentage share of your business — no repayments, no interest, but they’ll expect a return on their stake down the line.
In the UK, investors could range from angel investors to venture capital firms. But it’s not just about money. A good investor can bring experience, industry contacts, and strategic advice.
To improve your chances:
- Prepare a compelling investment deck
- Be clear on your business model, growth plan and exit strategy
- Build warm connections — use networking events and LinkedIn to make introductions
This isn’t the quick cash you might need — but for ambitious founders looking for a partner, not just a cheque, it can be transformative.
Grants: Free Money (If You Can Get It)
Grants are a golden ticket for many small businesses, because they don’t need to be repaid and won’t dilute your ownership.
They’re also competitive, time-consuming, and often tied to specific sectors or social outcomes. But for the right business, they’re worth pursuing.
For example, UK-based grants might be available through:
- Local authorities and LEPs (Local Enterprise Partnerships)
- Innovate UK (especially for tech or green projects)
- The Prince’s Trust (for young entrepreneurs)
- Charities and mission-driven organisations
Research past recipients and tailor your application to show alignment with the funder’s goals. Focus on impact, job creation, or innovation—not just financial need.
Crowdfunding: Build a Community Around Your Idea
Crowdfunding platforms let you raise money by pitching your idea directly to the public. That could mean offering early access, discounts, rewards, or even a slice of equity in return for support.
Campaigns that perform well tend to have two things: a compelling story and a pre-engaged audience. Don’t rely on strangers to fund your idea—bring your community, and then grow it.
You’ll need to plan your marketing and promotional push well in advance. And transparency is key — donors or investors will want to know exactly how their money will be used.
Friends, Family and Your Network
It might feel awkward but friends, family and former colleagues can be a powerful funding source, especially in the early stages of your business (e.g. start-up phase).
Even if they can’t back you financially, they might know someone who can. A warm introduction can often be more valuable than a cold pitch.
To keep things clear and professional:
- Be transparent about risks
- Put terms in writing, even if informal
- Agree up front on repayment (or equity) expectations
Handled well, this type of funding can strengthen relationships—not strain them.
Summary: You Can Fund Your Business Without a Bank
The funding landscape for SMEs has evolved. While traditional bank loans still have their place, they’re no longer the only option — or even the best one — for many businesses.
If you’re looking for quick access to capital, business funding advances can offer flexibility without lengthy applications or red tape.
If you’re planning for the long-term, investors or crowdfunding might make more sense. And if you want to grow with minimal risk, grants and network funding are always worth exploring.
The key is to choose the path that best fits your business goals, your risk appetite, and your stage of growth.
Small businesses access unsecured, fast funding from Got Capital. As an alternative lender, Got Capital offers financing solutions specifically designed for and catered to the needs of SMEs, free from personal guarantees.
