Do You Need to Have Money to Make Money?

BY: Courtney Rubin

Having access to money triples the likelihood that you will consider starting a business, says a new Gallup poll.

The worldwide poll of some 10,000 adults in 98 countries found that adults who had access to funds are three times more likely to say they plan to start a business in the next 12 months (18 percent) compared to those who don't (six percent).

Entrepreneurial intent varies widely by country. Though access to money universally improved the odds, it was less important in developed parts of the world. Residents of sub-Saharan Africa are the most likely to be planning a venture, though access to financing more than doubles the likelihood, from 16 percent to 39 percent. Just over a fifth (22 percent) of adults in Asia with funding access are planning to start a business, more than quadruple the five percent who don't have access.

By contrast, seven percent of adults in the US and Canada said they planned to start a business within the next year–compared to nine percent of those with access to finance. Money was slightly more important in the European Union: 2 percent of adults overall were planning to try entrepreneurship, compared to 7 percent of those with money.

"In Northern America, higher living standards, personal wealth, high-risk tolerance, and financial inclusion suggest that financing is not a major constraint to entrepreneurship in this part of the world," researchers Sangeeta Badal and Rajesh Srinivasan wrote. "Even if an individual does not have immediate access to money to start a business, he or she may be more likely than those in the developing world to be confident that he or she can secure the funding needed in the near future."

The study found financial access matters more to women than to men. Women who have access to capital are four times more likely to plan to start a business (16 percent) than those who do not (4 percent), while men who have access are nearly three times as likely to start a business (20 percent) as those who do not (7 percent).

SOURCE: www.openforum.com