In these years of economic contraction in which all companies seem to be affected by an economy that falters over time, we see how some small companies are separated from that pace of economic decline and experience a revaluation of their business.
Taking a different measure to that of large corporations
This boom may be due to taking a different measure to that of large corporations that allows it to not be so affected by the financial problems of the market. All companies are affected by macroeconomics, it is true, but small businesses may be more detached, given their characteristics, from the economy as a whole. But why invest in small businesses?
When investing in small companies, a detailed study of the company must be carried out, as far as possible, to avoid possible risks as much as possible.
A number of factors must also be taken into account before investing in small businesses, which are explained below.
Factors in favor of investing in small businesses
- Its level of indebtedness is lower than that of large corporations.
- They have more agile and flexible organizational structures that adapt to the needs of the market. Due to the smaller size of its structure, business decisions are made in an easier and faster way, so investing in small businesses means less paperwork for the investor.
- Largest net cash available . As Manuela Fernández, director of investments at Bankinter, said, 29% of large global companies have a net cash, compared to 45% in the case of SMEs, so there is less chance of their occurrence defaults when investing in small businesses.
- The risk-return combination is something present in all types of companies, but we must understand that a greater possibility of economic gain, as in large companies, also implies taking a greater risk than in investments in small companies.
Invest in small businesses in Good Finance
At Good Finance, a large part of the funding requests that reach our crowdlending platform come from small businesses and our investors are aware that investing in small businesses is also a very profitable option. As a result of this fact at Good Finance we have achieved a series of data that support the interesting thing about investing in small businesses.
In the month of February we have broken record in:
- Number of funding requests
- Number of registered investors, many of whom decide to invest in small businesses.
- Volume of loans funded, exceeding 500,000 euros
Soon we will exceed 100 intermediary loans on the platform and so far it has been possible to offer the possibility of investing in small businesses:
- With an average return above 7.77%
- On loans with 0% default (loans delayed more than 90 days)
All this accompanied by a high and efficient rate of growth throughout the short life of our innovative alternative financing platform. Therefore, being part of Good Finance and investing in small businesses is a good way to make your savings profitable.