Almost 70 per cent of Australians said the finance involved in starting or running a business was one of the biggest barriers.
According to the latest research from PayPal Australia, almost 70 per cent of Australian budding entrepreneurs (69 per cent) say getting the up-front finance is one of the biggest barriers to becoming your own boss. Yet almost two-thirds of Australians (63 per cent) have visions of working for themselves, with the overwhelming majority (69 per cent) willing to take a pay cut to realise this dream.
While the desire to be your own boss resonated with the majority of respondents, Gen Y (80 per cent) were much more interested than baby boomers (36 per cent). When asked about what sacrifices they would be willing to make, a third of Australian Gen Y said they’d be willing to take a pay cut (33 per cent); more than 60 per cent would be willing to work long hours; and more than half (54 per cent) said they would go without a holiday for a year.
Furthermore, one fifth of Gen Y respondents said they’d be willing to sacrifice up to $15,000 a year to work for themselves. The research found however that despite the willingness to make real sacrifices to realise their entrepreneurial dreams, almost 70 per cent of Australians said the finance involved in starting or running a business was one of the biggest barriers.
“The internet and cloud services have made it easier and more affordable for start-up businesses to access capabilities that were once only available to big businesses. It’s not hard to have a professional and highly functional web-based business in a relatively short space of time,” said Mr Simon Banks, PayPal Australia’s Director of Merchant Services. “However, although the technology is a lot more accessible, our research shows that SMEs are still struggling to overcome the financial hurdles associated with running a business and taking it to the next level.”
PayPal’s solution is PayPal Working Capital (PPWC), which has provided more than $100 million in funding to over 3500 Australian SMEs since its launch in 2014.
Repayments for PPWC are flexible, understanding that small businesses can face a lot of fluctuation. If an entrepreneur has a quiet week, there will be no repayment required that week. When there are larger volumes of sales, the business can then pay off a larger amount.
Odd Pears CEO Brock Sykes, 24, started his business in the garage of his family home in Mudjimba on the Sunshine Coast, selling mismatched socks in pairs of three to consumers across the country. Sykes always wanted to be his own boss and decided to leave his job in financial planning to start up his own business but acknowledges that it was a tough decision – both emotionally and financially.
“As a small business, cashflow is everything and we needed money right away to pay for everything from promotional items to shipping. With PPWC, you’re assessed on your PayPal sales history and when we got approved we had the loan in minutes, which meant we could pay the import taxes and had socks to sell in time for Christmas.”
Inside Small Business