Two thirds of entrepreneurs believe obstacles to securing funding for computer equipment poses the biggest threat to their firm
02.02.2004 - CCL News

Two thirds of entrepreneurs believe obstacles to securing funding for computer equipment poses the biggest threat to their firm, a new study has claimed.

In the poll of 500 directors of young UK businesses, 61% singled out problems with gaining finance as the greatest threat to start-ups.
Many entrepreneurs admitted funding difficulties in obtaining essential IT infrastructure presented a real risk to their company, according to the report by PC World.

More than a third cited quality computer systems as the key reputation driver of their business, even more important than premises and support staff.

The problem was so bad for 60% of respondents that they were forced to delay the launch of their company while they searched for equipment.

Many added that precious time was wasted while they waited for financial backers to check their credit history.

" The problem that start-ups face in securing funding for even basic IT equipment is one of the primary causes of the UK's huge business failure rate year after year," said PC World's Simon Turner.

" Most of the people we surveyed said that this difficulty is creating a business underclass which has little prospect of success."

The report also revealed that more than half of managers believed the downturn in the technology sector had made lenders more cautious about putting their money into new firms.

" During the dot.com boom, it was possible to secure early-stage funding from many sources virtually on a whim. Nowadays, even getting base level financing for IT equipment is a tortuous process that may be robbing the British economy of exciting new enterprises," Turner added.