Start-up businesses are popping up across the UK, particularly among the younger generations. A whopping 64% of the UK workforce wants to set up a business at some point in their lifetime, and 83% dream of self-employment. Generation Z desires the freedom and vast range of opportunities that come with entrepreneurial life. However, funding these new start-ups is whole other challenges.

Here are some options on how to fund your future start-up.

Family and friends.

Family and friends are becoming a more popular funding option among younger entrepreneurs. Small businesses often need some initial financial support to get their business off the ground and running. Family loans are flexible, quick and, potentially, a good investment for your loved ones depending on interest rates.

Equity release can help families offer gifts to small businesses run by their loved ones. Make sure to get a contract drawn up with the terms of your investment and the interest rates to avoid future arguments. One-third of people use equity to gift funds to their family and friends. However, mixing family and business can be a tricky relationship to manage.

Bank loans.

Bank loans are a more traditional form of funding. Research the different loans, terms and interest rates to find the right one for your business. With a bank loan, you can remain in total control of your business and draw up a professional and realistic repayment plan.

Choose a short-term loan to boost cash flow quickly or research guaranteed loans if you don’t qualify for more traditional loans. Like the Enterprise Finance Guarantee, schemes are an excellent way for small businesses to access funding if they don’t have a history of trading and financial security.


Investing your own money is the most admirable way to start a business. It shows investors that you are committed to your dream and have enough financial weight to put behind it.

You can start a business in a solid financial position by using your savings and staying out of debt. This will also stop you from giving away equity in the early stages.

Interest rates are at an all-time low with the recent financial crisis following the coronavirus pandemic. There’s no point leaving your cash sitting in a bank account when you could invest it in your own company. Bet on yourself!


There are thousands of research and development grants available. It’s hard to find them, and the application process is long and tedious. However, this is free money! It’s the government’s way of rewarding innovative start-ups that are changing the face of the industry. Of course, there are conditions to meet, and your business needs to fit the correct form of work for the grant.