Inflation numbers hit record levels in 2022, while the cost of living crisis raged and interest rates went through the roof.
Without a doubt, it was – and continues to be – a turbulent and uncertain time for many players in the City and beyond.
Time for City A.M. to catch up with Mike Randall, the CEO of Simply Asset Finance, one of the Square Mile’s fastest growing asset finance businesses and seen by many as a disrupter in the sector.
The City firm boasts it offers ‘an alternative financial model’ to the banks as its 120 staff serve around 5,000 customers via its £700m loan portfolio since the company was founded in 2017.
Randall zoomed in on growing a lending business through a pandemic, the invasion of Ukraine, a cost-of-living crisis, eye watering inflation numbers and how to stay calm and support SMEs across the country.
You must have your ear to the ground when it comes to SMEs and their concerns, are they very concerned about the economic and political instability, especially with a new Prime Minister?
Market uncertainty has become a normal state of affairs, SMEs have survived the pandemic, many even starting during it. But the one thing you can say is that they are resilient, they need support from lenders that understand their business, they need quick decisions and to get on with growing their business.
“What we are hearing more from customers is that they just want to get on with things.”Mike Randall
Of course there will be challenges, but these are entrepreneurs with drive and determination to succeed, they will learn with every obstacle or challenge that is put in front of them and that is what makes our businesses so great in this country.
What do you think is the biggest challenge facing SMEs in the UK?
Well Michiel, you can’t ignore the current economic and political turmoil, here in the UK and also globally, with soaring inflation coupled with the increasing cost of living. It is vital that the new Government continues to listen to business owners across the country and remove as many obstacles as possible so that they can get on with the important job of growing their business.
SMEs lending is not always straightforward, many cannot get a loan or support. How you support SMEs compared to other high street lenders?
In all honesty, lending to SMEs isn’t easy, you have to understand their business, their clients, their management team and what their goals are. We built a strong technology platform that enables us to do a deep dive inside these businesses, we know why they need the financing, what it is going to do for them, plus the team we have created are specialists in the industries we lend to.
Why do you think you can continue to grow when other lenders are raising rates and not providing the support for SMEs?
We sat down with a blank piece of paper and created a blueprint for what a good lender should look like. We wanted to be nimble and be able to stand out from other lenders. There was also a focus on building a business model that would allow us to cope with economic and political uncertainty.
I’m not sure we expected or could have foreseen a global pandemic, the invasion of Ukraine or the current energy crisis, but we have continued to lend.Mike Randall
What is most important to us and our customers is that we are there come rain or shine. One of the current headwinds for businesses across the UK are supply chain issues, you wouldn’t necessarily think that we would be able to help with that, but we can, our team is made up of industry specialists, they aren’t pen pushers, they have worked in dealerships, for manufacturers, they speak the same language and can often help to source equipment.
So it all comes down to relationships?
Yes, it is all about knowing your customers and you cannot remove the need for trusted relationships, technology can’t replace this but it can certainly enhance it. At the height of the pandemic SMEs struggled to get access to lending from high street lenders despite often being multi-generational businesses. Our door remained open and we continued to support these businesses throughout the pandemic, and this is something that I am very proud of, and it is something we will continue to do.