NEW YORK–(BUSINESS THREAD)– Nearly half of US SMBs are changing their technology stack to adapt to today’s economic climate, according to new Codat researchthe universal API for small business data.
The State of Small Business Software report is based on research conducted by YouGov in May 2022 that surveyed more than 500 founders, owners and CEOs of US micro, small and medium-sized businesses. 40 percent of SMBs are changing the way they use and think about tools and software in today’s business environment.
Of this 40 percent, the most common changes companies are making are changing suppliers (49 percent), seeking time savings (42 percent), increasing reliance on the software used to manage finances (41 percent ) and choose tools that integrate with each other (36 percent). percentage).
The findings highlight a divide between larger SMEs and micro-enterprises (< 10 employees) when it comes to their tech stack. Where 71 percent of medium sized businesses (> 100 employees) are reviewing their technology stack as a result of the economic climate, only 27 percent of micro businesses are doing the same. Additionally, 61% of micro businesses do not use any software to help with business planning and operations, compared to just 15% of medium-sized businesses.
This demonstrates a high degree of digital inertia among micro-enterprises that is exposing them to higher levels of risk than their larger counterparts as inflationary, interest rate and supply chain pressures grow. The research also shows the potential value of software integrations (the ability of organizational systems to exchange data) for SMEs. When integrations were explained along with a use case, 60 percent of respondents said connectivity would be an important factor for them in making future software purchase decisions. This rises to 88 percent for medium-sized companies.
“It’s good to see a significant proportion of SMBs recognizing the positive impact a connected technology stack can have on their business, but there’s still a gap in education,” said Pete Lord, CEO and co-founder of Codat . “The challenge will be to ensure that all SMEs, even the smallest, can take advantage of the full potential of integrated applications and not miss the opportunity to accelerate growth with automated data flows.”
Codat’s State of Small Business Software report delves into what today’s SMBs value in terms of their technology stack, which vendors they choose, and what drives their purchasing decisions. For more information, download the full report.
About Codat
ENCODED is the universal API for small business data. The real-time connectivity provided by Codat enables software vendors and financial institutions to build integrated products for their small business customers.
Codat’s customers range from lenders to corporate card providers and business forecasting tools and use cases include automatic reconciliation, business dashboard and loan decisioning. Codat was founded in 2017 and has offices in London, New York, San Francisco and Sydney.
The company has raised more than $160 million to date from investors including JP Morgan Growth Equity Partners, Canapi Ventures, Shopify, Plaid, Tiger Global, PayPal Ventures, Index Ventures and American Express Ventures.
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