Mid-sized businesses are one of the UK’s most important drivers of growth, projected to boost the economy by £745 billion by 2028. But with this ambition come challenges, complexities and nuances that could impact that journey, particularly when it comes to funding and financing.
Shawbrook’s latest report, The M Agenda, found that 78% of mid-sized businesses feel overlooked by policies and products that are often designed for smaller or larger businesses. This gap isn't caused by a lack of available funding products in the market; rather, it stems from a lack of awareness. Nearly a third (32%) of mid-sized businesses shared they were unable to access the level of funding they needed, while a further 32% reported that available options were overly generic, leaving these businesses underserved and specialist lenders underutilised.
Brokers are in a critical position to bridge the gap between ambition and execution, helping mid-sized businesses access the funding solutions they need to pursue their goals with confidence. Having a clear understanding of the products available in the market ensures businesses don't pursue the wrong type of finance for their needs or miss opportunities to structure funding in a way that best supports their growth plans. Factors such as project complexity, evolving requirements and alignment with wider business objectives are all crucial considerations when it comes to funding the middle market.
The consequences of misaligned financial support are not just a matter of lost time. According to The M Agenda, it puts mid-sized businesses at risk of losing out to competitors, delays significant investments needed to maintain their growth trajectory and hurts business credibility. With the UK economy so reliant on these businesses, supporting their journeys is where brokers and specialist lenders can work together to produce the most value.
Unlocking this value starts with a deeper understanding of the specialist lending landscape. While traditional lenders may have stricter criteria and longer processing times, specialist lenders often take a more flexible approach, assessing applications on their individual merits and reaching decisions more quickly. There is also a wider range of funding routes available, from asset-based lending to corporate leverage finance, designed to support different borrowing requirements and stages of growth.
Many specialist lenders now offer a range of complementary funding solutions under one roof. Brokers who understand the breadth of those capabilities can help ensure clients are introduced to the most appropriate team and funding structure for their needs, rather than defaulting to a single solution. As funding requirements become more sophisticated, this broader understanding can help brokers identify opportunities that might otherwise be missed.
For brokers, the starting point is asking the right questions early. Assessing a client's growth stage, asset base, cashflow profile and deal complexity will quickly indicate whether a specialist lender is the most appropriate route, and what type of funding is likely to be the best fit. A business pursuing an acquisition or operating in a niche sector won't just need flexibility, it will need a lender with genuine experience in that space.
That means brokers should look beyond headline rates when selecting a funding partner. Too often, the focus can be on simply getting a deal over the line, but the quality of support a business receives throughout the life of the facility can be just as important as the initial funding package. Relationship management, access to decision-makers and a lender's willingness to work alongside clients as their needs evolve are all factors that can have a significant impact on long-term success. This becomes particularly important when circumstances change or plans don't unfold exactly as expected. With 29% of mid-sized businesses valuing relationship management beyond transactional banking and 25% citing dedicated sector expertise as a priority, these qualities are increasingly becoming key differentiators.
The specialist lending market is vast, and it is up to brokers to help mid-sized businesses navigate it. British entrepreneurs show no signs of slowing down, and as ambitions grow and funding requirements become more complex, specialist lenders will play an increasingly important role in supporting the middle market. Realising that potential depends on brokers understanding the breadth of options available and working closely with specialist lenders to help businesses secure not just the capital they need today, but the support they need to succeed over the long term.
