Here are four things in the financial world that happened this past month and how they affect your business. Did you miss them?
1. Small business lending is at an all-time high in Georgia
A recent report released by the Georgia Small Business Administration shows that $1.41 billion was loaned in the state last year—and $650 million of that went to small businesses. Drew Tonsmeire of the UGA Small Business Development Center at Kennesaw State University says the lending environment is much better than it was 10 years ago. (Source: WJBF.com News Channel, SBA)
This is definitely not 2009, right? There will always be business owners who will struggle to get financing. But let’s agree that there is plenty of capital available today, particularly when compared to certain times in the past. Granted, there’s a cost. The cheapest financing still comes from traditional sources like banks and credit unions. But banks have tightened up their credit policies and mainly lend to companies with low risk. The Small Business Administration’s loan guarantee program can help. But otherwise, many small companies are finding that online loans have become a great source of capital. Yes, the costs are a little higher than banks. But the funds are there, and relatively easy to get.
2. Study: banks believe artificial intelligence can have a significant and positive impact on their business
The use of artificial intelligence (AI) and machine learning (ML) in financial services is rising, according to new market research done on behalf of augmented intelligence solutions provider Squirro. In fact, 83% of banks said they’ve evaluated AI and ML solutions, and 67% have started implementing them.
Unfortunately, the study also highlighted a lack of understanding around AI and ML, with 83% of respondents saying they’re unaware of how to apply the technology to solve business problems. (Source: The Fintech Times)
AI and ML technologies will, in the very near future, remove most human interaction between you and your financial institution. You’ll be emailing, texting and calling with questions and advanced software “bots” will be able to understand your requests and respond to them. Putting aside the impact on jobs, there’s much benefit in this for business owners, the most important being faster, less expensive, more timely and likely more accurate service (software never sleeps, right?). The smartest financial services companies, however, will understand that the best customer service balances technology with human interaction. We all want to speak to another person at certain times, and for some customers more times than others. In the future, you’ll need to decide how important that is, and whether you want to pay for it.
3. A venture capital fund is investing $36 million in black female founders.
Backstage Capital, a Hollywood-based venture capital firm that promotes underrepresented founders such as people of color, women, and members of the LGBTQ community, launched a new $36 million fund that will invest in black female founders.
The new funding will be provided $1 million at a time, according to the fund’s founder and managing partner Arlan Hamilton, who announced it at the United State of Women 2018 Summit in Los Angeles this month. In 2017, female founders received just 2.2% of the $85 billion invested by venture capitalists. (Source: Fortune)
Back in the day business owners and investors kept social and political issues away from business. Today, that environment has changed. Many want to work for (and with) companies that support people, values and attitudes that they do. The investment community is responding to this trend, and funds (like Backstage Capital) that target certain social causes, environmental concerns, political causes and gender demographics are popping up around the country.
Smart entrepreneurs looking to raise capital are going after investors that are more aligned with their values and concerns—and finding them more open to partnering.
4. There continues to be a narrowing, but persistent, gender gap in pay.
According to the Pew Research Center, the gender gap in pay in America has narrowed since 1980 but has remained relatively stable over the past 15 years. In 2017, women earned 82% of what men earned, meaning it would take an extra 47 days of work for women to earn what men did that year. The 2017 wage gap was smaller for adults ages 25 to 34 than for all workers ages 16 and older. Women in that age group earned 89% of what men in the same age group earned. (Source: Pew Research Center).
First, let’s agree that gender discrimination seems to have improved over the past generation. Just watch a few episodes of “Mad Men” and you’ll realize the significant challenges women in the workforce faced back in the day.
But even with those advances, we still have a way to go. Female workers have been more vocal in their concerns and governments are stepping in. Some local laws are now forbidding employers from asking about salary history in order to help give female workers a level playing field when applying for a job. The result is that today, it’s not only becoming increasingly illegal to practice any form of discrimination (pay or otherwise), it’s just not good business.
Ready for more?
Apply for funding and find out if you qualify today