According to the SBA, over 20% of businesses close within the first year in 2019. Less than half are expected to last past 5 years. In 2020 it was reported that about 60% of closures due to the Covid-19 pandemic were permanent. According to Yelp’s local economic impact report released in Q4 of 2020, almost 100,000 businesses permanently closed. Many people do not go into business wanting to only last 5 years. Most entrepreneurs want to build a legacy for their families but challenges impede their ability to continue.
There are various reasons for business closure including but not limited to, lack of access to capital, poor business planning and lack of market need. Additionally, many entrepreneurs have a great busines but lack the access to the network that can adequately support and promote their business.
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A network provides the tools needed for business growth and success. However, access is not equal and it can be constrained by where you are from, what school you went to and what neighborhood you grew up in. That access is even more limited due to race and socioeconomic status. In fact, Black businesses close at a disproportionately higher rate to other races. Having access to business resources is vital and there is a need for platforms that allows entrepreneurs to build a community of like-minded individuals that will be able to grant access to various people and resources including access to marketing resources and opportunities to grow their business.
When looking for a job, access to the hiring manager or a high-level executive, increases the chances of obtaining that position (or at the very least getting the interview). The same is true for business. Having the ability to know and rely on someone who could provide support and answers to varying business needs is vital for success and can withstand any economic climate. This is why community is so important. Being a part of a community where entrepreneurs are leveraging their strengths in business to support the sustainability of other entrepreneurs is a solution to constrained access.
Entrepreneurs, especially in the startup phase, are looking for connections not only to grow their network but also for business growth. In this climate, where are all separated due to the mandate to socially distance, entrepreneurs are yearning for meaningful connections. Communities provide a unique marketing opportunity for both those searching for business resources and those providing resources. Platforms, like ConnectEO Network, are democratizing access to business resources to create sustainable businesses. ConnectEO Network is a vetted digital network for entrepreneurs to build meaningful relationships and access business resources while marketing their business.
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Entrepreneurs are constantly looking for new marketing and advertising opportunities that are not going to cost them their entire marketing budget and also builds trust with their customer. Networks like these present a great opportunity for marketers to access thousands of businesses that would utilize their services without spending thousands of dollars typically spent to reach their target audience. Depending on the medium and reach, advertising can cost as much as $400,000 with a low conversion rate. These amounts are significantly outside of a most startup’s budget. Joining and finding ways to partner with these networks is a great way for marketers to not only support start-ups but grow their own business.
However, building trust imperative. Trust in marketing is so important. There are many examples of big businesses failing in their marketing efforts and losing trust from its audience. Not only do these networks present great marketing opportunities but they build trust with the customer through their referral nature. Referral leads have a higher conversion and lifetime use rate than most other marketing mediums. The main reason referrals are so effective is because the relationship is built on trust. You are more likely going to trust the business of those that were introduced through those whom you know than an unknown marketing ad.
Not only do these networks have a referral nature but they are also vetted communities. Vetted communities build trust within the network because the idea is that users have gone through a process ensures the safety of the community. Vetted communities filter users to those with aligned values and objectives. Startups value a community where others want to see them succeed and support their growth.
Entrepreneurs as part of their business needs are looking for connections to drive their marketing and joining community-based networks allows for entrepreneurs to obtain business resources while promoting their business and building trust with their customer.
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