Belfast Telegraph

Two-thirds of small business owners ‘get sleepless nights over valuations’

Some 66% of SME business owners said their biggest priority is increasing their company valuations.

Two-thirds of UK small business owners say they get sleepless nights over company valuations, according to new research (PA)
Two-thirds of UK small business owners say they get sleepless nights over company valuations, according to new research (PA)

Two-thirds of UK small business owners say they get sleepless nights over company valuations, according to new research.

The latest MarketInvoice Business Insights survey found that 66% of SME business owners said their biggest priority is increasing their company valuations.

Despite the focus on driving value growth, only 30% of businesses increased their valuations by more than 10% in the past 12 months, the survey revealed.

The average small business in the UK is valued at £2.9 million, bringing the total value of all UK SMEs to around £3 trillion.

Firms in the education sector have the largest average value, at £4m, and business owners in the sector are particularly concerned about value, with 81% in the sector describing it as a priority.

Business owners said that premises, the products, and people are the key things which bring value to a company.

Despite highlighting the importance of increasing company valuations, business owners said that they saw finding appropriate financing as a major hurdle.

Business owners said they are reluctant to cede control to Dragon’s Den-style equity or venture capital investors, with only 6% saying they have used this funding to drive growth.

More than a quarter, 26%, said they favoured invoice finance, while 22% of business owners said they use asset-based finance.

Anil Stocker, co-founder and chief executive officer of MarketInvoice, said: “Business owners seem to be driven by company valuation but acknowledge how the right kind of finance can really help drive that number.

“It is imperative that they stay focused on their product or service offering and ensure the fundamentals are right first.

“UK SMEs are thinking big, which is great for our economy, employment and global positioning.

“There are some huge macro and political changes taking place with Brexit and the US-China trade challenges but it’s great to see entrepreneurs seeing the growth opportunities around these events.”

PA

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