2023 Small Business Statistics

Small business growth and revenue statistics.

• 10 million+ new small businesses were launched from 2021 to 2022.
• Small businesses make up 99% of all U.S. companies.
• Small businesses employ 61 million people and nearly 50% of all private-sector workers.
• Small businesses saw a gross revenue of $13.3 trillion annually.
• The number of businesses owned by Black, Hispanic, and Asian Americans has increased by more than 50% from 2020 to 2007.

Source: Lendio

Small business owners’ sentiment statistics.

• 49% of small business owners believe it’s somewhat or much harder to achieve the dream of owning a small business than in the past. 33% of SMB owners believe it is somewhat or much easier. 19% say it’s about the same.
• 89% of small business owners believe it’s possible to attain the goal of owning your own business.
• The Mid-Atlantic region (New York, New Jersey, and Pennsylvania) had the most positive sentiment toward being able to start a business, with 96% of respondents believing it’s possible.
• The East South Central region (Kentucky, Tennessee, Alabama, and Mississippi) had the most negative sentiment, with 30% of respondents stating they didn’t believe it was possible to obtain the goal of owning their own business. 

Source: Lendio

Small business owners’ challenges statistics.

• 41% of small business owners state their number one challenge is related to the economy and inflation, with another 14% struggling most with financial concerns.
• Hiring remains the No. 1 challenge for 11% of small business owners, while COVID recovery vexes 4.5% of business owners and supply chain issues 3.4% of SMB owners.
• 56% of small businesses state that large corporations have a negative impact on growth opportunities for their businesses.

• 66% of small business owners state having a financial safety net would have had the most impact on their ability to start a business, followed by access to capital at 53%. 
• 21% of new businesses fail within the first year.*
• Of the respondents, 52% state that living in an area with lower business costs and a lower cost of living would be helpful. 44% state lower taxes would have a positive impact. 
• 33% state more customers and resources, 26% state less cultural bias, and 32% state access to educational resources and guidance would have had an impact on their ability to start a business.

Source: Lendio

*Based on U.S. Bureau of Labor Statistics Data of survival rates of businesses started in 2017.

Small business funding statistics.

• 54% of SMB owners started their business with personal funds, with another 12% relying on friends and family. 14% used a bank loan, 3% an online lender, 3% venture capital, 3% crowdfunding, and 4% credit cards.
• 79% of SMB owners needed less than $100,000 to start their business, while 43% needed less than $10,000.
• The average loan amount for a small business owner is $47,000.*
• A small business has a median of five employees when it is first funded by an outside lender.*
• A small business has been in business for about three years (a median of 40 months) when it is first funded by an outside lender.*
• Minorities received 27% of SBA 7(a) loans and 24% of SBA 504 loans in 2022.

*Based on internal Lendio data of 300,000+ loans funded since 2013.

Source: Lendio

Small business owner generational differences statistics.

• Those under the age of 45 report needing more money to start their business, with 23% needing $100K to $250K. In contrast, only 10% of those aged 45+ needed that amount.
• While both generations rely heavily on personal funds to start their businesses, those under the age of 45 have started to turn to alternative sources, such as crowdfunding (6%) and online lenders (5%).

• 46% of younger business owners (18-44) believe owning a small business is somewhat or much easier to achieve. 
• 58% of older business owners (45+) believe owning a small business is somewhat or much harder to achieve.
• While a large majority (71%) of SMB owners aged 18-44 believe large corporations have a negative impact on growth opportunities for their business, 57% of those 45+ disagree, stating large corporations don’t have a negative impact on their business.
• While the generations agree that a financial safety net, access to capital, and low costs are most critical to success, those 44 and younger place greater importance on access to educational resources and see cultural bias as a larger inhibitor. 
• Both generations agree that the freedom to live how you want is the most important component of the American dream. Perhaps unsurprisingly, those 45+ place greater importance on retirement (46%), while those under 45 place more importance on becoming wealthy (36%).

Source: Lendio

Small business owner gender differences statistics

• A significantly greater number of women (49%) needed less than $10,000 to start their business than men (36%).
• A significantly greater number of men (21%) needed $100K-$250K to start their business than women (12%).

Source: Lendio

Best states to start a small business.

1. Texas
2. Florida
3. Ohio
4. Massachusetts
5. North Carolina
6. Colorado
7. Oklahoma
8. South Carolina
9. Georgia
10. Utah

Source: Lendio

Lendio is committed to helping small business owners survive and thrive by making funding more accessible to small business owners. Learn more about small business loan options.

Best industries to start a business.

Healthcare remains a top industry to start a business with a 41.1% ten-year survival rate. Professional, scientific, and technical services come in at the lowest cost of entry with median startup costs of $7,500.