Case Study
Lerags Farm Luxury Glamping Ltd
Business Overview
Lerags Farm Luxury Glamping Ltd (“Lerags”) is a private limited company incorporated in December 2022 and wholly owned by Katherine Mackenzie. Located just outside Oban, on six acres of land owned by Katherine herself, the business aims to address a long-standing gap in the local tourism market: the shortage of high-quality, self-catering accommodation during the busy summer season.
Recognising the demand from travellers visiting Oban – often referred to as “the gateway to the islands” – Katherine’s vision is to offer a premium glamping experience. Each pod is designed for comfort, privacy, and tranquillity, making use of a spectacular location within easy reach of Scotland’s west coast.
Katherine brings with her extensive hospitality experience, having operated both a successful café (Taste of Argyll Kitchen Ltd) and a farm shop in the local area. Her knowledge of the tourism sector and existing customer base provide a solid foundation for this new venture.
Business Requirement
Katherine initially planned to develop the site in partnership with a third-party glamping operator. However, after that company entered administration, she made the decision to independently complete the project on a smaller scale. Planning permission is already in place for five glamping pods, with completed groundworks funded through personal investment and a Start-Up Loan.
With two pods now ready to be installed and furnished, additional funding was required to complete construction and begin trading by Spring 2025. The goal is to establish a lean and sustainable operation – starting with two high-quality pods and scaling further based on self-generated revenue.
Securing the Business Loan from DSL Business Finance
Katherine secured a total funding package of £70,000 from DSL Business Finance via the Investment Fund for Scotland (IFS). The loan complements her own investment of £56,000 (via a Director’s loan and support from Bute Enterprise Finance), which has already covered groundworks and planning costs.
The DSL funding is being used to:
- Purchase and install two luxury glamping pods from a trusted local provider
- Complete site preparations, including fencing, decking, and electrical connections
- Furnish the pods to a high standard ahead of the 2025 holiday season launch
The glamping business will operate with low overheads and will be managed directly by Katherine and her daughter, who will handle guest changeovers and cleaning between stays.
Key Success Factors of Successful Loan Application
Several factors contributed to the successful application:
- Proven Local Demand: Oban’s tourism demand significantly outpaces supply during the high season, providing strong market potential.
- Experienced Operator: Katherine’s background in hospitality and direct experience managing self-catering lets positions her well for success.
- Prepared and Invested: With planning approved and site infrastructure already in place, the business is ‘oven ready’ for launch.
- Low-Cost Model: Direct management, lack of payroll expenses, and lean operating costs mean faster break-even and reduced financial risk.
- Growth Potential: The business holds planning permission for five pods, allowing for expansion using future profits.
Katherine Mackenzie, Founder of Lerags Farm Luxury Glamping Ltd, said:
“I found Lesley to be very professional and helped me through each step of the way. I would highly recommend DSL.”
Iain Burnside, Chief Operating Officer, DSL Business Finance, said:
“Lerags Farm Luxury Glamping Ltd is a fantastic example of how rural tourism can evolve in a sustainable and community-led way. Katherine’s experience, investment, and commitment to quality give this business a strong chance of long-term success. DSL is proud to help entrepreneurs like Katherine realise their vision and contribute to Scotland’s vibrant tourism economy.”
Investment Fund for Scotland
The £70,000 loan from DSL Business Finance was delivered through the British Business Bank’s £150 million Investment Fund for Scotland (IFS), launched in October 2023. The fund offers loans ranging from £25,000 to £2 million and equity investments up to £5 million. DSL Business Finance manages the Smaller Loans Fund, supporting Scottish businesses with funding between £25,000 and £100,000.
