Few Finnish entrepreneurs focus on growth, according to Danske Bank survey

A new study from Danske Bank reveals that Finnish entrepreneurs are increasingly prioritizing maintaining their daily operations over expanding their businesses. The Entrepreneur's Financial Peace of Mind 2024 survey shows that more than half (53%) o

By: helsinkitimes.fi

Oct 03 2024
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Few Finnish entrepreneurs focu

A new study from Danske Bank reveals that Finnish entrepreneurs are increasingly prioritizing maintaining their daily operations over expanding their businesses. The Entrepreneur's Financial Peace of Mind 2024 survey shows that more than half (53%) of Finnish entrepreneurs are focused primarily on running their day-to-day business, while only 21% consider growth a primary objective.

Entrepreneurs' financial outlook has also worsened, with just 40% expressing optimism about their company's financial future—a notable drop from 47% four years ago.

The survey, last conducted in the early stages of the COVID-19 pandemic in 2020, highlights growing economic pessimism, particularly among younger entrepreneurs and small businesses employing two to three people.

“The findings underscore the importance of a stable financial foundation, especially in today’s uncertain economic climate,” said Tuomas Aho, Director of Small Business Customers at Danske Bank. “Optimism and belief in the future are the driving forces behind growth, not just for businesses but for Finland as a whole.”

Young Entrepreneurs Show Less Confidence

Confidence in financial stability varies significantly by age and company size. Younger entrepreneurs under 40 are the most pessimistic, with only 16% expressing strong confidence in their financial situation. In contrast, entrepreneurs over 55 feel much more secure about their financial standing.

Declining Focus on Business Growth

The study found that a growing number of entrepreneurs are less focused on business expansion, with only one in five (21%) seeing growth as a top priority. This marks a decline from 2020, when 25% of entrepreneurs were focused on growth. Many entrepreneurs, particularly those running small businesses, prioritize securing a stable income over ambitions of significant expansion.

“For many small business owners, the goal is simply to earn a living, not to conquer the world. However, it’s still important for even the smallest businesses to consider development to ensure future stability,” Aho noted. “At the same time, growth-driven companies are vital to Finland's success, and it’s concerning that the number of entrepreneurs aiming for growth is declining.”

Gender Differences in Business Goals

The survey also highlights that female entrepreneurs are more likely than men to concentrate on maintaining daily operations rather than expanding their businesses. Only one in six entrepreneurs (16%) aims to develop their company into an attractive acquisition target, and just 1% sees a public listing as a goal.

“While few entrepreneurs prioritize growth, we see a major opportunity for those willing to take calculated risks and aim higher. Smart risk-taking can be the key factor that sets successful businesses apart,” Aho concluded.

The study offers valuable insights into the challenges and mindset of Finnish entrepreneurs, particularly during uncertain economic times, and underscores the need for strategic support for those aiming to grow.