Why Timing Isn't the Whole Story for Startup Finance

This afternoon I read James Robson's latest piece, "The Access Myth," and it's a good one. If you're anywhere near SME finance, go read it.

His argument is that the industry has spent a decade banging on about "access to funding" when the actual problem is timing. Lenders want to lend, they're not sitting on piles of cash out of spite. Most businesses go looking for credit when things are already tight, get graded as risky because of it, and pay more for the privilege. Ask for the same money four months earlier, before the wobble, and you get a different business on paper. The same company can receive a different price because of the timing.

It's a great read & I largely agree with the view. I just think it only holds up once a business has actually been going a while.

Robson's whole argument leans on a business having something to time in the first place, a trading history, a set of accounts, a shape a lender can look at and price. Fine if you're two or three years in. Less fine if you registered the company eight months ago and you're still figuring out your own cash flow.

James clearly knows established businesses inside out. But "established" is doing a lot of work in that sentence, and a lot of businesses aren't there yet.

If you're in your first year, there's no cycle to time because there's no cycle yet. There are no good or bad moments, just not much of a track record either way. You have no filed accounts, you don't have a full run of bank statements a lender can point to and say "yep, that looks stable." Often nothing to secure lending against beyond whatever the director owns personally. And revenue, at a start up can be inconsistent rather than something you can plot on a graph with confidence.

So what happens? Lenders do the only thing they can, they price the founder instead of the business. Your personal credit history becomes the business's credit history, because the business hasn't built one yet. That's not a timing problem. That's an access problem, plain and simple. You can't "apply at the right moment" if you haven't been trading long enough to have one.

This is where I'd actually push back on the framing a bit. Robson's right that the industry over-obsesses about access once a business is established enough to have options. But in year one, access is still very real, it's just moved. It's not "can I get funding at all", it's "can I get funding that doesn't require three years of history I don't have yet."

A few things genuinely help here, and they're not exotic. A business bank account from day one, even before you need one, starts building the paper trail lenders will eventually want to see. A business credit card, used properly and paid off, does the same thing for your credit file without you needing to ask anyone for a loan. And invoice finance is worth knowing about earlier than people think, because it's assessed on your customer's ability to pay rather than your own trading history, which makes it one of the few funding routes that's genuinely easier to get in year one than year three.

None of that replaces what Robson's talking about. Once you've got two or three years behind you, his advice is exactly right, know your own cycle, don't wait until it hurts to go looking for money. But in year one, the job isn't timing the market. It's building something a lender can actually look at.

Worth a read either way: https://mail.jamesrobson.finance/p/the-access-myth