An independent survey compiled by fintech company Iron Capital Equities confirms; 'Need to Hire Staff' as the number one reason Small Business Owners are applying for debt financing.
The data was aggregated from LineofCreditDepot.com's (https://www.lineofcreditdepot.com) standard small business application from November 2021 - December 2021. When asked in a multiple choice, ''Specific Use of Funds,' small business owners chose a required response from a list of: Equipment Purchase, Refinancing Debt, General Working Capital, Need to Hire Staff.
From a dataset of over 2,500 applicants, about 68% overall selected the option "Need to Hire Staff." More specifically, out of the pool of applicants whose annual revenue was over $1,000,000 in 2021, an even higher 77% selected this option.
"With our fintech software we are able to spot trends over time in the data from our applicants. It gives us valuable insight into the needs of small businesses, and allows us to more accurately cater to those pools of potential clients," says Co-Founder Matthew Elling from Iron Capital Equities.
This analyzed data is evidence that hiring post pandemic is of top concern for small business owners. Elling hypothesized, "I think that the request for capital response could actually mean that businesses are reacting to feeling lost revenue actually because of a current lack of workforce. The act of requesting funds is more of a reaction from the labor shortage, where businesses are seeing lower revenue, perhaps meaning their businesses may not be profitable, due to the lack of staff. Applicants believe that the reason why their business needs money is because of the lack of staff."