Puerto Rico’s small business firms vary in size, years established, business performance, credit experience, and training needs. This report examines the smallest firms, the micro-entrepreneurs with annual revenues of $50,000 or less.
1 Micro-entrepreneurs typically have two, or fewer, employees; are recently established; and derive the majority of their revenues from sales to consumers.
Business performance in 2015 was more challenging for them than for larger firms. Only about 20 percent of micro-entrepreneurs reported being profitable or having increased annual revenues.
Credit demand was comparable to larger firms. The top ranked reason to seek credit was to expand the business or to cover operating expenses. However, only 34 percent of micro-entrepreneurs obtained full funding. Frequently mentioned reasons for weak credit outcomes were insufficient credit history, insufficient collateral and low credit scores. In the event of partial or zero credit funding, the micro-entrepreneurs turned to friends and family; delayed or passed on a business opportunity; or down-sized their operations.