OECD recommends crowdfunding for SMEs
“Small and medium-sized enterprises play a vital role in driving economic growth and creating jobs, but access to finance for these firms will remain a challenge for years to come,” OECD Secretary-General Angel Gurría said during a presentation of both reports.“There is a pressing need to enable small businesses to diversify their funding sources by tapping alternative finance instruments,”
Some alternative instruments such as crowdfunding and factoring are gaining traction but venture capital investment and leasing have yet to recover to 2007 levels in most countries. The OECD warns that high levels of non-performing loans among SMEs have a negative effect on banks’ willingness to lend and pose a particular threat to economic recovery in the countries most affected by the financial crisis.
Extract from this report.
As a mechanical engineer, I like to think on stability, and to explain very simple concepts, I use these 2 sketches.
These are 2 stable positions. If a small deviation is applied to the ball, the ball is or falling, or going back to the same position. When the ball is falling, it is falling or right or left.
Coming back to the financing of SME, they are essential to countries economy, not because of their revenues, but more about the jobs they offer. But every time there is a crisis, and the frequency is now more often, it deviates and looks more as an unstable state, than a stable state, where larger companies grows bigger, and small companies get smaller, the smallest being the “one person” company as auto-entrepreneurs.
What should be a stable state about job employment now. My idea, more and more pregnant, is that :
- gouvernments care about umployement only at elections, and promises only bind those who listen
- banks concentrate on trades (their community), not on entreprises
- people should be concerned on how to create their future jobs, and not let this subjects to the 2 above authorities.
The only way for people to care about their jobs is crowdfunding, because if they let it to so called “investors only”, it comes sooner or later back to governements or bankers via funds.
Yesterday, I had an interesting exchange of emails with one of my follower. He pretended that the amount I was asking where to high, and people could be afraid of it. I answered that for the influence free mind I wanted to keep, I needed that these projects (at least at the beginning) didn’t depend on large influence groups and remained in large international crowd’s hands. This is a much more stable state!
I can encourage you, even with a small amount, to participate in my crowdfunding campaigns, maybe just for future jobs!