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BizReport : Research : March 31, 2015

Manta: Crowdfunding not high on SMB's radar

Crowdfunding has become quite a popular way to fund new ventures, but according to one new study the crowdfunding craze really hasn't caught on with small business owners. In fact, Manta's new survey finds only about one-third of SMBs say they used 'alternative funding' measure because they didn't qualify for traditional bank loans.

by Kristina Knight

Small businesses continue looking to banks to fund their ventures. That is the takeaway from a new survey out from Manta which indicates only 38% of SMBs used 'alternative' funding options because they didn't qualify for bank loans. About 20% say they looked to alternative funding because they needed small short-term loans.

Just over 70% of SMBs say they look to traditional bank loans and even credit cards or personal savings to finance their business ventures.

"Small business owners have more diverse options today than ever before when it comes to funding their business," said John Swanciger, CEO, Manta. "However, we're seeing a gap between what's available and the perception among small businesses that the lending environment has not improved. Even though traditional bank loans are difficult to secure, small businesses are still apt to rely on them."

Some interesting findings from the report include:

• 69% of SMBs say business funding 'has not improved' in the past year
• 23% say they've used alternative funding options, 2% say they've used crowdfunding
• 30% say they haven't looked to crowdfunding because they don't know the risks

Image via Shutterstock

Tags: crowdfunding, small business, small business trends, SMB trends

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