When new entrepreneurs need funding for their companies, what’s the first place they turn? The mirror.
Entrepreneurs self-fund about 57 percent of their money needs, according to new U.S. Global Entrepreneurship Monitor Report from Babson College and Baruch College. Support from friends and family was critical, too, researchers found.
The report revealed that a typical entrepreneur needs about $17,500 to start his or her company. Break it down by gender, and men needed about $20,000 while women sought $10,000.
“Globalization, changes in technology and social awareness have provided an impetus to develop capital flows from diverse sources,” said Donna Kelley, Babson College professor of entrepreneurship and the report’s lead author. “Startup activity benefits from widespread recognition of the role entrepreneurship plays in increasing employment and improving the economic health of the nation.”
The report also found that U.S. entrepreneurial activity was down last year, following four years of increasing activity. Most of the decline could be attributed to fewer people starting new businesses.
Black Americans started businesses at a higher rate than whites did last year, though the business ownership rate for whites is about twice as large for white Americans.
Women had lower rates of entrepreneurial activity, except in the 35- to 44-year-old age group, where it spiked.
