Though National Small Business Week is coming to a close, the impact of small business on our country remains a constant. Whether you’re launching at startup in San Francisco or opening a bakery in Portland, the milestones you hit and challenges that you’ll face will largely remain the same.
For those starting a business in 2015, you’re in luck: not only is optimism about the economy on the rise, but now is a great time to get a loan.
According to the State of Small Business in America Report, “while only 29% of small business owners said they’ve applied for a business loan over the last two years, 90% of those who applied for a loan were approved.”
Additionally, alternative lending sources have grown immensely in popularity— P2P lending platforms (a.k.a marketplace lending platforms) are expected to reach USD $350 billion by 2025. Thankfully these funding options are expanding because the cost of starting a business is not cheap; according to Babson College statistics cited by the Wall Street Journal, the average cost of launching a startup is $65,000. And it's risky—the failure rate of startups after four years is 50%.
Startup vs. Small Business
If you're wondering what differentiates a startup from a small business, you're not alone. Startups are small businesses, but there are some fundamental differences. In order to give you some perspective, we created this side by side chart:
|“Temporary organization designed to scale”||“Independently owned and operated, organized for profit, and not dominant in its field.”|
|Owner wants to disrupt the market||Owner wants to be his/her own boss|
|Top-end revenue and growth potential||Driven by profitability and stable long-term value|
|Large market||Unique market|
|Rely on capital that comes via angel investors or venture capital firms||Small business operations may rely on loans and grants|
|Have a developed exit strategy||May or may not have an exit strategy|
Who, What, Where, When, Why?
Regardless of if you're starting a small business or startup, as you navigate the muddy waters of starting your own venture, the questions and concerns are limitless. You’re probably wondering where the best place is to start a business, how much you can make in various locations around the country, what kind of funding is available where, and plenty more.
We rounded up some helpful stats for our State of Small Business Infographic to help you visualize the current landscape of funding, earning and industries that are suceeding. Download it below to learn more!