Birmingham finance consultancy Straight Finance has gone into liquidation, leaving its licensees facing an uncertain future.
The firm, which traded as Straight Business Solutions, worked closely with the local financial community to arrange equity, debt and grant financing for businesses through its network of licensees.
Straight Finance sold licences to business finance advisers, costing more than £10,000, who recruited clients around the country looking to raise cash for their businesses.
But the Jewellery Quarter company was wound up just before Christmas using a voluntary creditors liquidation, blaming problems in the lending market and public sector cutbacks.
Its assets, including the licensee network, have now been acquired by a new company whose directors are Andrew Mitchell and Mike O’Dwyer, both previously directors of Straight Finance.
The directors have written to the licence holders – which they say total five active advisers and several inactive ones – saying they want to continue working with them in the new company.
Mr O’Dwyer said the firm had been advised to take the liquidation route and had done so in a bid to make sure staff were paid.
Straight Finance worked with local bankers and financial professionals as well as public sector bodies like Business Link and Advantage West Midlands to arrange finance for local firms.
Mr O’Dwyer said public sector cuts and the state of the lending market were to blame.
“The reason being the demise of Business Link and Access to Finance coupled with the banking sector becoming even more difficult in terms of their pipeline.
“Deals were taking longer and personal guarantees were being asked. A lot of deals did not come to fruition.
“With the infrastructure that we put in place, we could not continue to fund the company out of our own pocket,” he said.
Licence holders are now waiting to learn more about the structure and business model of the new company and are planning to meet up to discuss the situation.
One, who did not wish to be named, said: “We are left wondering what’s going to happen and we await further correspondence to see what they are going to do.”
Mr O’Dwyer said many of the licence holders had other business interests, but insisted those that wanted to continue would be supported under the new company.
“We will still have one of the directors who will be very much able to continue with whatever needs doing.
“I want to try to see if there’s still opportunity to work with these people if they chose to do that.
He added: “Nobody’s going to be left in the lurch other than if it’s their own choice.”
