The vast majority of small and midsize businesses are self-financed by their owners, according to a new survey.

The survey, by BlueVine, an online provider of working capital for small businesses, found that only 15 percent of SMBs use bank loans.

Based on a survey of 692 SMB owners in various industries throughout the U.S., BlueVine found that 83 percent of SMB owners have bootstrapped their companies and built them using their own personal finances. Only 15 percent of SMB owners have used a loan to fill cash flow gaps. In contrast, 60 percent used personal funds to fill cash flow gaps, 48 percent went without pay, and 17 percent delayed major expenses such as payroll or rent.

Seventy-five percent of SMB owners report that their primary source of funding comes from their own personal finances, followed by banks (16 percent) and family/friends (6 percent). Only one out of three SMB owners have applied for a personal loan to finance their business. Of those small business owners who have applied for a business loan (34 percent), 40 percent reported having a bad experience.

Nearly four out of five SMB owners said they have experienced a cash flow gap. When faced with a lack of cash, 60 percent used personal savings to continue to fund their business, 48 percent went without pay, and 25 percent delayed payments on a major expense, such as payroll or rent, or cut back on employees or hours.

More than half (55 percent) of the SMB owners surveyed said they manage their finances on their own. Thirty-three percent of SMB owners said taxes were the most surprising expense they did not anticipate when starting a business, while 28 percent said the cost of technology (new software, HR software, payroll, etc.) was the most surprising. Nearly 50 percent of SMB owners said that among a list of external factors, government regulation has the greatest impact on their business.

“Despite the amount of capital available today, it’s clear that cash flow challenges continue to be a significant growth and operational hurdle for the vast majority of business owners,” said BlueVine CEO Eyal Lifshitz in a statement. “The findings of this survey indicate that small business owners in America are in need of accessible, external funding options, and continue to be self-sustaining and reliant, largely out of necessity.”

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