What share of small businesses use financing?


The answer to this question depends on whom you ask. According to the Kauffman Firm Survey, one-third of young firms do not use capital injections. Instead they rely on owner investment or nonbank sources of funds. A Census Bureau dataset finds that over half of existing firms do not need expansion financing. This reflects the fact that many businesses are not growth businesses; they reach an optimal size and stay that way. And some businesses are structured so that they self-finance. (These two sources draw from different sample pools; the Kauffman pool has a larger than average business size; the Census set includes very small businesses and its average size more closely approximates the national average.)

 

source: http://www.sba.gov/