Despite the economy avoiding a triple dip recession many leading entrepreneurs remain concerned about long-term growth prospects, according to the latest Smith & Williamson Enterprise Index which is issued quarterly. There was a marginal drop in the headline figure, although there were signs of positivity elsewhere.
The inaugural Index, carried out in January of this year, recorded a positive outlook as far as the economy was concerned, whilst the latest one has seen a slight dip in respondents' optimism. The main concern for respondents centred around the fact they don't believe Chancellor George Osborne is doing enough in terms of deficit reduction.
However, despite the fall in confidence, other figures from the survey suggest that the rise of crowdfunding as a means of finance for businesses could help with future growth.
With many businesses still struggling to get finance from the banks, crowdfunding is a route that many entrepreneurial businesses are considering.
"With most businesses unwilling or unsuited to raising traditional venture or growth capital, and with a scarcity of bank loans and overdrafts, there's an increasing focus on the alternatives," explained Guy Rigby, head of entrepreneurs at Smith & Williamson, the accountancy and investment management group.
"Enter crowdfunding. For businesses, there are essentially three types of crowdfunding: reward-based, loan-based or equity-based and there are an increasing number of providers competing to fill this space. Whilst, in some cases, there are regulatory challenges which undoubtedly need to be resolved, it's new, it's here and it's a welcome alternative for the nation's entrepreneurs."
Coinciding with the increased interest in crowdfunding was a rise in export confidence. Of those entrepreneurs surveyed who actively engage in export, many expect their turnover to increase during 2013. However, this is not reflected across the wider spectrum, where turnover expectations for exporting and non-exporting businesses combined fell back against the initial reading.
Despite the fledgling signs of optimism in certain areas, it is the growing concern around Osborne's deficit reduction plans that remain the biggest concern for entrepreneurs.
"Growth is returning but both tax rates and spending are still too high for the economy to really move forward," said Steve Hallam, CFO at Legacy Portfolio.
"The imbalances that caused the recession still remain largely unaddressed and I don't believe that simply throwing money at the housing market will help this."
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