Research of 1000 SMEs by private equity business Albion Ventures saw access to finance for SME’s drop in a list of fifteen priorities from 6th in 2015 to 13th in 2016.
With 50% of small businesses with over five employees planning to grow their headcount over the next two years, finding skilled staff tops the list of challenges business owners face, up from third place in 2015.
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It is a particular problem for manufacturing, construction, medical and healthcare companies.
In sixth place, the decision to leave the EU ranks below perennial challenges such as red tape, regulatory change and the difficulty of accessing new markets.
SME appetite for equity funding
Over a quarter of SME firms would consider investment from venture capital, private equity or a business angel, rising to a third among larger firms with more than five employees. On a sector basis, over half (52%) of IT and telecom firms are open to equity finance while construction trails at just 13%.
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By GlobalDataAt a breakfast briefing yesterday in Westminster for investors, private equity professionals, the banking community and the press, Patrick Reeve, managing partner at Albion Ventures said that the lack of access to finance had ‘finally’ dropped off the list of priorities for SMEs, which could mean the funding gap is closing, but that competing interests should be born in mind.
Patrick Reeve, managing partner at Albion Ventures, said: “Against a backdrop of profound change, one element that has remained reassuringly unchanged is the optimism underlying the UK’s small businesses. Firms are looking to grow their headcount and productivity is on the increase. The biggest barrier to growth, finding skilled staff, is generated by success rather than failure.
“The downside is that the economy is coming under capacity constraints at a time of considerable political uncertainty. While many of the pressures on growth we have seen in recent years have eased, the skills that enable us to compete are in short supply.”
