(New York, NY) August 7, 2013 – OnDeck, the technology-powered Main Street lender, released today findings of its 2013 Main Street Pulse Report, a small business trends study. The study is based on data gathered from over 500 survey responses and approximately 10,000 business loan applicants nationwide across 700 different industries.
Key findings from the OnDeck Main Street Pulse Report reveal that 73 percent of small business owners believe the economy is getting better and want to grow their business. One in five small businesses have increased head count over the last six months and two in five plan to over the next six months.
Despite the optimism, one major challenge remains: access to growth capital. Of those who applied for capital, 64 percent were unable to secure any type of financing and 82 percent were denied for financing by their bank. Furthermore, small business owners are self-selecting out of the application process: two-thirds of business owners who didn’t apply for funding chose not to because they believed they would be denied by banks, not because they didn’t need capital.
“Our Main Street Pulse Report indicates that the majority of small business owners are optimistic about the economy, but have been stalled by traditional lenders,” said Noah Breslow, chief executive officer, OnDeck. “Despite strong demand for financing, small businesses are struggling to secure the capital they require to grow. Small businesses are a critical component of our economy, and the need for more funding alternatives like OnDeck has become increasingly apparent.”
Additional findings from the 2013 Main Street Pulse Report include:
- Small businesses have a median borrowing need of only $44,000
- 84 percent of small business owners use funding for growth capital:
- 29 percent for expansion and facility upgrades
- 16 percent for inventory and equipment purchases
- 39 percent for working capital
- Top 3 small business challenges:
- Access to capital from traditional lenders
- Growing sales
- Navigating taxes
- Top methods for attracting more customers:
- Word of mouth marketing
- Natural website search
- Email marketing
To learn more about OnDeck and view the full infographic, please visit: www.ondeck.com/industrypulse
About On Deck
Launched in 2007, On Deck uses data aggregation and electronic payment technology to evaluate the financial health of small and medium sized businesses and efficiently deliver capital to a market underserved by banks. Through the On Deck platform, millions of small businesses can obtain affordable loans with a fraction of the time and effort that it takes through traditional channels. The company’s proprietary credit models look deeper into the health of businesses, focusing on overall business performance, rather than the owner’s personal credit history. The On Deck system also provides a critically needed mechanism for financial institutions and other business service providers to efficiently reach the Main Street small business market.
On Deck has deployed over $450 million in capital to tens of thousands of businesses in 700 different industries. The company is growing at greater than 100% annually, and was recently named to Forbes’ 100 Most Promising Companies in America list and the Inc. 500. On Deck is financed by some of the nation’s leading venture capital firms, including Google Ventures, SAP Ventures, RRE Ventures, and Institutional Venture Partners.
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