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Business funding trends in 2017

The economic slowdown has been evident since the last few years. The dramatic changes in the funding landscape have compelled start-ups and small businesses to rethink their funding strategies.

However, the economic landscape has been showing considerable improvements. Though the economy is evidently emerging from rough waters, the time is still not ripe for small business financing. Surveys estimate that private equity investments in India had slipped by 25% in 2016 and the number of sealed deals fell from 1,752 in 2015 to 1,309 in 2016.

The VCCEdge Report highlights this global paradigm shift. It states how the private equity investments in India had slipped by 25% in 2016 and the number of sealed deals fell from 1,752 in 2015 to 1,309 in 2016.

Reports make it amply clear that the global economy is yet to recover completely and emerge from the rough waters. This leaves start-ups and SMEs to acquaint themselves to the existing funding scenario and the prevalent trends so they can make conscious funding decisions for incremental business growth.

Here are some of the leading business funding trends of 2017.

Applying for small business loans

small business loan

Considering the economic scenario, there has been an apparent global shift towards more reliable methods of funding. No wonder, small business loans offered by banks and other financial institutions have emerged as a preferred funding option. Borrowing capital enables businesses to postpone valuation negotiations that accompany equity funding. It saves them from the risk of selling shares at a much lower rate, referred to as ‘down round’ according to industry parlance.

Corporate Venture Capital

corporate venture capital

It is another form of equity investment like the traditional VC model, but with a difference. While VC pertains to the capital raised from external investors, CVC attracts large corporations who show interest in investing for their own benefit.

Government funding

government funding

Government-backed funds serve as one of the most secure methods. Global State Governments float funds and open incubators to train and mould potential entrepreneurs.



Platforms that bridge the gap between businesses looking for funds and potential investors have been growing in leaps and bounds as a much-favoured funding option, helping in small business financing. What’s more, they also assist businesses in engaging with their target audience and analyze how receptive their target audience is towards their new start-up idea. This aids them in growing their business while developing their products and services.

Change in investment assets

investment assets

A paradigm shift in terms of funding will become evident. Crypto currencies like Bitcoin and precious metals such as gold will emerge as a preferred funding option. With the economic downturn, shifting capital to an undervalued class from an over-valued asset will become dominant as a risk management strategy for organisations looking for small business financing.

New funding options

funding options

The emergence of new funding options has been a relief for new-age start-ups that are on the lookout for small business loans. A survey by Tech Circle mentions that existing and new investors have initiated almost 36 new funds over the last few options, enhancing the scope of start-ups and small businesses getting funded even when the economy is precarious.

Alice Williams
Working with writing challenged clients for over five years. She provides Business profile writing and small and large business press editing services Her educational background in science and journalism has given her a broad base from which to approach many topics. She especially enjoys writing business trends and upcoming technologies used in businesses.