Monika Sobeková Majková,

Faculty of Economics and Business,

The Paneuropean University,

Bratislava, Slovakia,

E-mail: monika.majkova_sobekova@paneurouni.com

The Analysis of Chosen Business Obstacles

and Problems with

the Financing of Young Entrepreneurs in Slovakia

Ján Solík,

The Association of Young Entrepreneurs in Bratislava,

Bratislava, Slovakia,

E-mail: jan.solik@zmps.sk

Juraj Sipko,

Faculty of Economics and Business,

The Paneuropean University,

Institute of Economic Research, Slovak Academy of Sciences,

Bratislava, Slovakia,

E-mail: juraj.sipko@paneurouni.com

ABSTRACT. Small and medium-size enterprises (SME) are the backbone of every economy. Usually they create half of state added value and employ about two thirds of employees. Because of their importance for each country, we decided to write about their problems in relation to obtaining finance. Small size is the primary reason why they have problems securing a bank loan. Furthermore, they usually have a short business history and weak capital power. Unemployment of young people is not a problem only in Slovakia but also in the European Union in general. In 2013, more than 30% of young people under 25 years old were without work – an alarming number. Supporting entrepreneurship is one to decrease this figure. In 2011-2012, we conducted research on young Slovak entrepreneurs and the problems they encounter in starting a business. In this study, we try to illustrate the present business obstacles and issues with financing of young businessmen in Slovakia. The main objective of the study is to conduct a theoretical knowledge review on financing of SMEs and to analyse the main factors that make obtaining finance more difficult in Slovakia. We would also like to show different points of view of young entrepreneurs and potential young entrepreneurs in Slovakia on financing businesses and also the different viewpoints of men versus women. After this analysis, we would like to offer a summary of opinions to solve this problem. Slovakia has a big problem with unemployment of young people and one of the ways how this issue could be solved would be to support young businessmen in overcoming obstacles in starting their own businesses.

Received: July, 2014

1st Revision: September, 2014

Accepted: October, 2014

DOI:10.14254/2071-789X.2014/7-3/7

JEL Classification:G11, G32

Keywords: small and medium sized enterprises, young entrepreneurs, financial resources, obstacles in financing, barrier of financing.