The true cost of scaling

Just over two thirds (67%) of SME leaders have used personal savings or remortgaged their homes to help grow their businesses, according to new research from Shawbrook. The findings reveal the significant personal risks founders take to fuel expansion.

Unprepared for Expansion

Seven in ten founders admit they underestimated the emotional and financial demands of scaling from a small to a mid-sized business. As companies grow, leaders face greater complexity, responsibility, and pressure than many initially anticipate.

Behind strong business performance lies a human cost. Nearly three in ten leaders (28%) reported experiencing periods of isolation or loneliness during their scale-up journey, while a similar proportion saw stress levels rise as operational demands increased.

Founders are heavily invested in their businesses’ futures. Two-thirds (67%) used personal savings or remortgaged to fund growth, and 69% said the financial risks were greater than expected. Despite this, many pressed on in pursuit of long-term success.When Growth Pays Back

The risk often delivered results. Nearly two thirds (65%) of founders said revenue growth ultimately outpaced rising costs, demonstrating that while scaling is challenging, it can lead to stronger commercial performance over time.

Funding Gaps Persist

Access to suitable finance remains a barrier. More than a quarter (28%) struggled to secure funding aligned with their growth stage, highlighting a gap for medium-sized businesses that are too large for start-up support but too small for traditional corporate banking.

To make scaling more sustainable, founders highlighted the importance of tailored finance (30%), peer support networks (30%), mentorship or external advisers (29%), and mental health or resilience resources (28%).

Neil Rudge, Chief Banking Officer for Commercial at Shawbrook, said medium-sized businesses are central to the UK economy but need more specialist support. Flexible finance and stronger peer networks, he noted, could help founders scale more sustainably while unlocking greater economic growth.

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