ThinCats Research Reveals Key Funding Gaps Between Small and Mid‑Size SMEs

ThinCats’ Fresh Look at How Small & Mid‑Sized SMEs Slap on Borrowing Gear

ThinCats, the front‑runner in alternative lending for mid‑size SMEs, has just dropped a brand‑new study that peels back the curtain on why tiny firms and their larger cousins have such different money‑machinery needs. If you’ve ever wondered whether a dozen‑employee shop feels the same pinch when it comes to getting a loan as a 200‑employee powerhouse, this survey has the answers.

Who Was Asked, and How Many?

2,000 businesses in total
1,200 small companies (fewer than 10 crew members)
800 mid‑size ripper outfits (ranging from 10 to 249 employees)

Key Takeaways—The Digest

The “How” of getting the money: Small firms are more likely to tap local bank offers or keep it in-house, whereas midsized peeps pull in a mix of banks, private funds, and strategic partners.
Reasons to borrow: Small businesses usually want a quick fix for a single project—latte‑themed marketing ads, perhaps—while mid‑size firms are often lining up for long‑term growth, like a new factory or a tech break‑through.
Future plans: In the next 12 months, mid‑scale companies are already penciling in more funding rounds than their tiny counterparts. Small firms, meanwhile, are more content sticking to split payments and low‑risk methods.

Borrowing Habit Shocker

On a surprising note, a whopping 75% of the small businesses admitted they’ve never even applied for external debt. Flip to the mid‑size side and the figure drops to 38%—a big jump that tells us the bigger guys are less shy about the money‑talk.

Why This Matters

In plain English: small firms might be flying solo because they’re cautious about debt, or they simply lack the resources and push to chase bigger pots. Meanwhile, midsized companies are already juggling multiple funding sources, giving them more leverage—and hopefully a smoother path to scaling up.

Bottom line: If you run a small shop with just a handful of staff, you might want to keep your eyes peeled on where the big players are picking up their funding. If you’re a larger outfit, you’re not alone—there’s a whole ecosystem humming underneath you, waiting to boost your next big move.

Mid‑Sized Companies Are on the Credit Hunt – While Small Ones Are Taking the Scenic Route

In a whirlwind of financial curiosity, mid‑size firms are three times more likely (17% vs 5%) to dive into external debt over the next year. Why? They’re itching to grow, and their confidence pumps the fear factor of borrowing down.

Ask for Advice – The Mid‑Size Way

Only 56% of small businesses ask for any funding advice.
Mid‑size peeps are way more chatty:
- 24% talk with a commercial finance broker.
- 23% get an accountant’s blessing.
- 17% reach out to a corporate finance or debt adviser.

What’s in the Wallet? Recent Funding Preferences

Working capital is the most popular pick (42%).
Followed by asset‑backed finance (33%) and growth capital (21%).
Mid‑size businesses are twice as likely to snatch growth capital (27% vs 13% for small firms).

Where’s the Cash Coming From? Banks, Lenders, All the Above

High‑street banks top the list (56% of SMEs for recent funding).
Alternative lenders trail at 11%, asset‑backed lenders 8%, and challenger banks 6%.
Small firms lean heavily on high‑street banks (60%) versus mid‑size (54%).

Loan Size Matters

Companies pulling in more than £10m prefer a corporate finance adviser (59%).
Loans between £250k‑£5m see most help from accountants or brokers.
For <£50k deals, most firms skip advice entirely.

Big Bucks and Big Changes

High‑street banks still reign for <£10k‑£5m loans (50%+).
For larger sums, that popularity flips: high‑street bank share drops to 28% (for £10‑15m), while private debt funds and direct lenders surge to 28%.

Expert Insight from ThinCats

“It’s easy to think all SMEs are the same, but this research shows that while small firms (90% of the UK SME universe)’re an everyday part, mid‑size firms (about 25% of GDP) drive major growth and sail confidently into borrowing.”

Mid‑size SMEs are the engines of expansion; their resilience makes them more comfortable taking on external funding. Their complex needs mean they often lean on alternative lenders and advisers to hit the perfect debt match.