Tech Nation has said that although many scaleups have missed out on the coronavirus business interruption loan scheme (CBILS), now is the time to apply for growth funding under the scheme as the deadline approaches.
The scaleup network said that many companies were excluded from CBILS – which offers loans of up to £5m to firms suffering from the impact of the crisis – due to its original application criteria which ruled out businesses making a loss as of December 2019.
Tech Nation added that many scaleups also wrongly believed that the scheme exists to help struggling companies survive, rather than push dynamic companies to thrive.
The firm said this myth needs to be dispelled and a CBILS loan can be used for a variety of purposes.
“With the extended deadline – 31 March 2021 – fast approaching, it’s time for scaleups to consider why and how they could put this source of growth financing to use,” Tech Nation said in a blog on its website.
“CBILS is a diverse product that can be tailored to help with anything from acquisitions to investment in research and development, or hiring new staff.
“Alternative finance providers…are enabling scaleups to push the limits of what a loan can do.”
Tech Nation said that venture debt can better help scaleups grow as it allows founding teams to retain more equity in their business and is also cheaper, with the equivalent equity investments typically costing three-and-a-half times more.