CHICAGO, May 7, 2018 /PRNewswire/ - BMO Wealth Management (U.S.) today released a report exploring how small business owners view and implement innovation, with a focus on the key factors driving their innovation and those that are holding them back.
The report, Creating Wealth through Business Improvements, is based on a survey of 1,021 small business owners across the United States. They were asked about their experiences funding their innovations via business loans and government grants, their knowledge of and participation in accelerator and incubator networks, and what they believe to be the keys to innovation success.
Key survey findings show:
The majority of respondents had never applied for funding to support small business innovation (60%).
The most common explanation provided by respondents for not exploring funding options was that they didn't want to incur debt (36%), followed by the belief that they would be rejected (22%) and that the process was too complicated (21%).
Very few of the small business owners surveyed had taken advantage of government grants – just four percent indicated they had ever applied for one.
Nearly half (44%) said they were aware of government grants but unsure where to apply, and 34% were not aware of the availability of grants at all.
The widespread lack of knowledge about capital funding and government grants also extended to another important source of innovation assistance – incubator and accelerator networks:
Nearly two-thirds (63%) of small business owners said they weren't aware of these support systems, with just 3% indicating they had used them.
Women reported being substantially less knowledgeable than men, with 72% of women being unaware that incubators and accelerators could be a valuable tool, compared to 54% of men.
"Having access to information about funding options and support networks is essential to the continued success of a small business, particularly in its early stages," said Tania Slade, National Head of Wealth Planning, BMO Wealth Management (U.S.). "Business owners who take advantage of the numerous resources at their disposal have an immediate advantage, and a far greater chance of seeing their innovation initiatives realized."
When asked to identify the top three keys to innovation for a successful entrepreneur, respondents most frequently cited access to funding (66%), followed by access to networking (64%), partnerships with staff, suppliers and customers (61%), and access to mentoring programs (40%). This suggests that business owners know how valuable funding and networking opportunities can be and are, in fact, interested in taking advantage of them. In short, they lack information, not motivation.
BMO offers the following tips for small business owners:
Join their local Chamber of Commerce and attend monthly events.
Seek counsel from their local bank to get an overview of potential loan options.
Read small business blogs which often highlight local, state, and federal funding programs.
BMO Wealth Management serves mass affluent, high net worth and ultra-high net worth individuals and families with a full suite of wealth management solutions including wealth planning, banking and borrowing, investment management, retirement planning, trust and estate services, philanthropy, insurance and risk management, tax planning and ultra-high net worth services. With over 140 offices across 16 states and international offices in Canada, Hong Kong, and Singapore, BMO Wealth Management provides guidance and planning advice combined with individualized service and local experience. As of January 31, 2018, BMO Wealth Management had assets under management of US$49 billion and assets under administration of US$80 billion. BMO Wealth Management is supported by the resources and stability of one of North America's premier financial services organizations—BMO Financial Group. Visit bmowealthmanagement.com
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