Challenge Facing E-Commerce Founders

Last Updated: 07/31/2020

While it’s true that e-commerce platforms, like Shopify and BigCommerce, have democratized online entrepreneurship and lowered the barriers to entry, there are still many challenges that face e-commerce business owners.

Like all founders, these new-age entrepreneurs require funding to grow; however, the financial world hasn’t evolved to meet the needs of online founders.

Lack of capital is the number one barrier to e-commerce growth

50% of all startups won’t survive their first 5 years and lack of access to capital is cited as a major barrier to success.

Over 80% of Americans do not have access to equity or debt financing—and e-commerce businesses get an even shorter end of the stick since they have fewer hard assets. As a result, only about a third of new businesses survive their first decade.

So what’s an e-commerce entrepreneur to do? The first step to securing the right kind of business funding is to fully understand the different types of e-commerce funding that currently exist, and the pros and cons of each.

But first…let's discuss the different types of business funding: