Report: Baltimore Needs More Robust Financing System For Small Businesses

By Sarah Gantz
The Baltimore Sun

WWR Article Summary (tl;dr) A new report from Johns Hopkins reveals that while the amount of venture capital flowing to startup companies in Baltimore has grown significantly in recent years, much of the money comes from far-flung investors not local lenders.

Baltimore

Baltimore needs a more robust financing system to help small businesses grow and to attract new companies.

That’s the conclusion of a new report by Johns Hopkins University’s 21st Century Cities Initiative that evaluated access to venture capital funding and small business loans for startup companies and more established Main Street small businesses.

The report found that while the amount of venture capital flowing to startup companies in Baltimore has grown significantly in recent years, much of the money comes from far-flung investors. Lending for small businesses also has been on the rise, but still falls short of pre-recession levels.

Without access to the capital they need to grow, startups and small businesses may struggle to grow and could even be inclined to leave in search of stronger financial support.

“Our financing systems here have a lot of strengths,” said Ben Seigel, executive director of 21st Century Cities. At the same time, he said, “what we’ve seen is there is a lot of fragmentation. We could be getting a lot more out of the system we have.”

The report is based on data collected by studying investments to Baltimore-based companies through 40 public and private funding sources between 2000 and 2016, and interviews with more than 50 stakeholders from banks, investment firms, and other financing and business support organizations.

To improve the flow of cash, the report recommends the city and business community make a more concerted effort to connect businesses and investors. Local banks and venture capitalists could be passing over investment opportunities in their backyard because they are unaware of the companies.

Related News

Leave a Reply

Your email address will not be published. Required fields are marked *