Ask any business owner what their top need is and they’ll say — “finance”. Yet fewer than one in five entrepreneurs applied for finance from banks or other funding institutions in the last year, a survey released today revealed.
The survey, carried out by Seed Academy — a division of ICT accelerator Seed Engine — sampled 1 200 entrepreneurs.
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In a press release, Seed Engine CEO Donna Rachelson, said that only 18% of the surveyed entrepreneurs have in the last year attempted to get funding from banks or funding institutions like the Industrial Development Corporation or the Department of Trade and Industry.
“Some entrepreneurs indicated that they simply don’t know where to go for funding especially in light of the fact that most early-stage business funding requirements are below the R100 000 threshold.
Only 18% of 1200 entrepreneurs surveyed said they had applied for finance in the last year
“There is certainly a case to be made for funding providers to revise certain requirements to better accommodate the unique needs of small and early-stage businesses,” she said.
The report also cites access to markets as one of the main challenges faced by entrepreneurs. Additionally, it also highlights a 9.5% decline in the number of businesses run by youths under the age of 35 .
The survey also claims that the number of women-owned businesses grew from 31% in 2016 to 47% in 2017.
“Encouragingly, we are seeing the gap between the number of male and female entrepreneurs start to narrow as women represented 47% of entrepreneurs surveyed. This gives some indication that efforts focused on the development of women owned businesses are beginning to pay off.
“Similar initiatives are now urgently needed to develop youth entrepreneurs so that entrepreneurship is viewed as a ‘real’ career option,” said Rachelson.
Seed Academy began surveying entrepreneurs for this year’s survey in March.
Read more: Seed Academy launches ‘State of Entrepreneurship’ survey
Feature Image: Supplied
