Financial Needs in SMEs

This chapter deals with one of the main management aspects addressed by the equity crowdfunding instrument: coverage of financial needs. Small businesses need to finance development without weighing down their financial structure, and raising capital becomes a decisive factor, especially in countries where bank credit is businesses’ main source. This is unlike many other countries where small businesses make little use of the possibility of finding the capital they need in the market on their own. Financing investments in SMEs therefore continues to be based almost entirely on internally generated resources and bank loans, mainly in the short term, resulting in companies’ inability to seize growth and development opportunities.