Access to funding remains the number one challenge facing entrepreneurs and the reason why around 80% of start-ups don’t succeed beyond the first year.
Research has also found that only half of the 20% that do survive past the first year-mark, are still in business in year three.
The biggest problem, according to Seda Acting CEO Lusapho Njenge, is the widespread lack of financial literacy among entrepreneurs, and financial readiness when it comes to putting together an application for funding. It’s for this reason that the agency established FinFind.
“More often than not, small business owners are unprepared when they approach potential lenders. As a result, they are more likely to be turned down by lenders, both in the public and private sector,” Njenge was quoted saying in a Business Day report.
FinFind, which was developed over five years in partnership with the USAids financial sector programme, seeks to connect small business owners with financial providers in both the public and private sector, while educating entrepreneurs through financial literacy training.
Fund seekers are encouraged to test the state of their financial readiness based on lender requirements, and for those who are found not to be financially ready, FinFind will offer online advice to help overcome the challenges.
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You also have the option of visiting your nearest Seda branch for a free or subsidised assessment, or they will put you in touch with an accredited SA Institute of Professional Accountants accountant or an Institute of Business Advisors South Africa-accredited advisor.
The portal is also an information hub that entrepreneurs can use to learn about the common challenges faced by small business owners trying to access funding and how to overcome them. It unpacks the different types of business needs for financing and the options that exist for each one, as well as what lenders look for and what is expected of you, among other things.
FinFind has teamed up with SMEasy – developed by serial entrepreneur Darlene Menzies – which is a free assessment service for SMEs that helps entrepreneurs manage their finances and record-keeping in an understandable and seamless manner.