Leeds City Region Enterprise Partnership (LEP) and MarketInvoice have announced a major new partnership to fuel small business growth and job creation across the region. From November 2016, £2 million a year will be available to businesses in Leeds City Region via the MarketInvoice platform – a service that allows businesses to release the funds tied up in invoices with long payment terms.
Business owners will be able to upload outstanding invoices online, where they’re funded by investors including the LEP. When the invoice is paid, typically after 45 days, investors’ money is returned and is ready to be used again. The initial investment of £250,000 will be deployed on a continuous basis and will be earmarked exclusively for local businesses in a bid to drive a more consistent level of support for SMEs in the area.
Cllr Peter Box, Chair of the West Yorkshire Combined Authority said: “All too often I meet with businesses that say cash flow can be a major barrier to growth – in particular SMEs. We are continuously listening to the needs of our local businesses and looking at ways to help them prosper.
“I am pleased to launch this new initiative with MarketInvoice to deliver additional business support at a local level, further demonstrating how the public and private sector are working together to deliver on our economic ambitions.”
Chair of the LEP, Roger Marsh OBE said: “Maintaining cash-flow is vital to small and medium businesses. That is why the LEP is contributing to this platform, to help provide a solution for businesses facing a long wait for payment of their invoices. By quickly releasing finance that would otherwise be tied up in the short-term, business owners can keep up momentum with their activity and invest money back in the business where it is most needed.
“The LEP keeps track of the latest business support initiatives so businesses don’t have to. This is another example of how the LEP is supporting the local business community and I encourage firms looking for advice and support to contact us to find out more.”
The partnership marks the fourth government and local authority tie-in for MarketInvoice who also work with British Business Bank, Greater Manchester Combined Authority and West Oxfordshire District council. Through these, more than £106.7m in funding has been advanced to businesses in the catchment areas of local investment pools.
Anil Stocker, Chief Executive & Co-founder of MarketInvoice, comments: “The average payment cycle for invoices across the UK is currently 45 to 60 days, which is too long for many companies that want to grow and expand operations. As an entrepreneur, I understand how difficult it can be to pin down the finance solutions that will help ease the day-to-day demands of running a business so I believe it’s vital that solutions like ours are easier to find and use on a local level. It’s fantastic that the LEP feels the same.
“By helping local companies to get quicker access to the much-needed funds tied up in outstanding invoices, the LEP is able to invest directly into the local economy, boosting businesses and creating jobs across the district.”
MarketInvoice is flexible, meaning firms can sell as many or as few invoices as they need. Once approved, businesses can draw-down on funds against invoices same-day. Costs are typically between one and three per cent of the value of the invoice. More than 40 Leeds-based businesses have already benefited from using the easy-to-access facility.
Hugh Barker, MD at local Leeds business, iComply, has been a customer of MarketInvoice since March 2015. The business has accessed close to £750,000 in funding through the platform and currently employs 15 people locally. He comments; MarketInvoice are one of the new breed of financial institutions stepping smartly into the gap left by the banks in commercial lending. They’re tech savvy, smart, well organised – an absolute joy to deal with. They made the effort to understand the commercial processes of our sales cycle and really wanted our business.
BigChange Apps, another of the Leeds businesses already working with MarketInvoice, agrees: “We were in discussion with MarketInvoice for some time before we started using the service. Their sales team are highly professional. When we started using the service the on-boarding team dealt with us efficiently and we have been now working together for approaching 12 months. We use Market Invoice for financing certain customer contracts and we also have the option to use the invoice factoring facility. Their technology works so well and cuts out all the manual processes. I would highly recommend Market Invoice to any company that is growing and prefers to use this option of finance rather than traditional methods.”