You’ve heard it time and time again: small businesses are the backbone of our economy. The U.S. Small Business Administration (SBA) found that small businesses represent 99.7 percent of all employer firms. These businesses have also contributed to 64 percent of new jobs and have paid 44 percent of private total payroll in the U.S. And yet, despite the economic foundation small business owners provide, their companies, along with startups, are struggling to grow and survive.
Before the Great Recession, it was projected that 600,000 new businesses would be created every year. Today, that number is closer to 400,000, and only a small fraction of those new businesses actually survive after a year or two.
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Small businesses and startups lack access to funding
While there are a number of reasons why entrepreneurs struggle to open shop and maintain a steady business, there is one reason that stands out: new business owners can’t find funding.