PresentationJune 2015

• a Community Interest Company (“CIC”) established in 2013 with support from Arts Council England

• offering finance based products and services designed to support the growth and productivity of the UK’s cultural and creative industries

• Consumer credit (Own Art and Take it away); business lending (Creative Industry Finance); further programmes currently in development

Creative United

Our mission:

to build a sustainable and resilient creative economy, making the arts accessible to all

About the pilot programme

• 2 year pilot programme (May 2012 – March 2014)• Business support plus access to loan finance (£5k - £25k)• Open to creative industry micro and SMEs in London

and Yorkshire & Humber regions• Fully funded by Arts Council England

Investment and key outputs

• 628 applications received• 437 businesses referred/1961 hours of support provided by delivery

partners (Key Fund and East London Small Business Centre)• 59 CIF loans totalling £876k (including £76k in ‘recycled’ capital)• £800,000 invested by Arts Council England as risk capital (£600k in

London; £200k in Yorkshire & Humber)• £500k additional loan finance leveraged from other sources • 75% of loan recipients operating for less than 3 years• £400k of infrastructure support for Creative United and revenue for

delivery partners covering costs of free business advice offered to clients under CIF programme

• Total investment from Arts Council England over 2 years = £1.2m

Aims and objectivesImproving…

• access to finance for micro, small and medium scale enterprises (SMEs) operating within the cultural/creative industries

• the business skills and commercial experience of SMEs operating within the cultural/creative industries

• the financial profile/lending history of creative industry SMEs with growth potential

Enabling…•business growth, talent development and job creation•further investment from the private sector

Establishing…•an evidence base for the demand and effectiveness of loan finance

as an alternative to grant funding for commercially viable cultural and creative industry enterprises

Outcomes (Year 1) Of the 28 businesses that received loan finance in Year 1

• 47% report an increase in turnover• 25% average increase in turnover across all businesses

– 23% average for ‘commercial’ (fashion, design, digital etc)– 35% average for those within the more traditional subsidised arts sector

(theatre, publishing, visual arts etc) • 36% report an increase in profits• 55% confirm an increase in the number of clients/customers• 16% have grown their number of direct employees• £1m = total value of business growth

Case Study – Muf ArchitectureSince 1994 Muf Architecture has established a reputation for pioneering and innovative projects that address the social, spatial and economic infrastructures of the public realm.

Despite an average annual turnover of £500,000, their bank of 18 years refused them credit at a very critical moment, deeming their fluctuating cash flow as presenting too high a risk.

In the first year following receipt of loan finance from CIF, turnover increased by 20% to £600,000. This financial year they expect even better things with a predicted turnover of £957,000.

“Our business advisor had an extraordinary understanding of a creative business and our particular needs. Definitely, we have done loads more in terms of cost and time management thanks to the business advice.”

Loan of £25,000 (repayable over 3 years)

Case Study – Ditto PressDitto Press (established in 2009) is an independent publishing house and printing company specialising in the arts and creative print.

Ditto’s reasons for applying to CIF were twofold: to help it develop a better and more sustainable business model and to help it expand into new premises with room for a shop and gallery

The loan from CIF enabled Ditto to pay moving costs including agents, deposits and fit-out, but equally importantly business advice sessions ensured that with the move came a new sustainable business model.

Ditto Press has now widened its product range and services, and successfully reached new clients.

Loan of £25,000 (repayable over 36 months)

National programme

Programme structure

Our Lending Partners

Application criteria

Criteria•Minimum 18 months trading (no upper threshold)•Operating in England•Cultural/Creative Industry enterprise

Business types•Sole traders•Limited companies•Partnerships•Social enterprises•Charities (including trading arms of registered charities)

Lending parameters•Secured and Unsecured loan •Minimum £2K; Maximum £2m+•Repayment over 1 – 7 years•Variable interest rates (typically 10% – 15%)

Document pack (for referral to lender)

• Letter of introduction from Creative United

• Client key information sheet

• Social impact statement (where relevant)

• Business Plan (PDF format)

• Last 3 years’ accounts (if available; minimum year 1)

• Latest year to date management accounts

• Estimated income/expenditure for current year, plus 2 years’ financial projections (Excel format)

• Copy of Data Protection/Data Sharing Agreement signed by Client (PDF format)

Applications (September 2014 – April 2015)

Statistical analysis

September 2014 – April 2015

• 439 businesses registered• 92 applications submitted• 69 placed with an advisor• 223 hours of support delivered• 7 businesses referred to a lender• 6 businesses offered loans• £90,000 of finance accessed

Number of employees

Finance requirements

Level of finance requested

Contacts

Sarah ThirtleHead of Business Lending Programmessarah.thirtle@creativeunited.org.ukDD: 020 7759 1112

Genevieve PaceProgramme ManagerGenevieve.pace@creativeunited.org.uk DD: 020 7759 1114

www.creativeindustryfinance.org.uk Twitter: @CIFinanceFacebook: /CreativeIndustryFinance

www.creativeunited.org.uk