Business Finance – SMEs hopeful of growing year ahead.

Dotcoms are still an attractive proposition for private investors in spite of mixed signals regarding confidence in the new economy. The British Venture Capital Association has found the amount invested by business angels into technology companies has more than doubled over the past year to nearly #14m. Technology companies benefited from nearly half (49%) of all business angel investment over a 12-month period during 1999/2000, with internet companies attracting 36% of all technology investment.

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Increasing merger activity is putting pressure on banks and finance providers to operate with greater transparency, according to financial intelligence bureau The Global CFO. It found that 81% of CFOs believe banks and financial advisors should be required to come clean on their credentials and products in one online forum.

Nearly a third of multinational companies expect the pace of mergers, acquisition and fund raising for expansion to accelerate in 2001. Global CFO chief executive, Etienne Deshormes, above right, said: ‘As 2001 looks set to be a year of continuing and increased activity, finance decision makers need to cut down on the time spent researching potential financial service providers. The internet is the perfect delivery mechanism for such information.’

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Despite gloomy economic forecasts, morale among small businesses remains strong, according to a survey carried out by Bibby Financial Services. Researchers tested confidence levels among 300 companies with a turnover between #50,000 and #1m and found that many have made optimistic resolutions for the year ahead. More than half of those questioned (57%) will be pursuing new markets for products and services; 54% are looking to improve cashflow management and one in five are in search of new funding sources to back business growth. Some 24% are planning to move to larger premises and a third hope to take on additional staff during this year.

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Lloyds TSB is offering commercial GAP insurance to business customers to protect them against circumstances where the customer’s insurer writes off commercial vehicles or fixed assets. Lloyds said the insurance would cover situations where settlement payments by insurers proved insufficient to both replace the asset and cover the outstanding balance of any loan taken out by the customer to fund the original purchase. The insurance will assist business customers by paying the difference between the write-off value of the asset and the outstanding balance of the loan.

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