When it comes to technology and being early adopters, millennials come to mind for most people. That has even been the case when it comes to alternative lending options available outside of traditional bank loans. According to a Bank of America Small Business Owner Report, millennials are significantly more likely to take advantage of alternative lending sources than Gen-X or Baby Boomers. In addition, an Experian survey found that 47 percent of millennials said they are likely to use alternative finance sources in the near future.
While many of these studies refer to consumer lending, the same could be said for small business lending as well. However, our experience at Lendio has been quite different from recent reports and industry trends. Based on lending data from our platform, 80 percent of Lendio’s customers are non-millennials ages 35 and up. Our data shows that older entrepreneurs are actually adopting online alternatives more rapidly than younger generations.
As the nation’s leading marketplace for small business loans, Lendio’s findings fall in line with a Small Business Administration report that shows the national average of small business owners tends to be older: 15.6 percent under the age of 35, 32.7 percent between the ages of 35 to 49, and 51.7 percent are between the ages of 50 to 88. The 2015 Kaufmann Index also reports that baby boomers continue to surge as a percentage of entrepreneurs, and people ages 55 to 64, make up a quarter of all new entrepreneurs. The next oldest group, ages 45 to 54, also experienced a rising share of new entrepreneurs nationally.
With all this in mind, the average age of small business owners on Lendio’s platform is 50.4, aligning with the national average and indicating that among small business owners, the demand for alternative lending sources already exists and is strong across age groups.
Even though the age groups accessing alternative lending continues to fluctuate, business loans and sources for traditional capital have become increasingly more difficult to obtain for small business owners and consumers alike. Whether a small business requires additional capital to start or grow, the business opportunity is real and often unmet. But at Lendio we’re proud to say that since our founding, we’ve facilitated more than $250 million in funding to more than 10,000 small businesses. Through Lendio’s free online service, applicants can find the right loan within minutes – regardless of age.