11

PCA Index Survey ResponsesFourth Quarter 2013

Craig Everett, Ph.D., MBA Director, Pepperdine Private Capital Markets Projec t

© 2012 Pepperdine University. All rights reserved. Pepperdine Private Capital Access Index (“PCA Index”) and Private

Capital Demand Index (“PCD Index”) are trademarks of Pepperdine University. PCA Index and PCD Index content is the

intellectual property of Pepperdine University or its third party content providers. Any copying, republication or

redistribution of PCA Index or PCD Index content, including but not limited to caching, framing or similar means, is expressly

prohibited without the prior written consent of Pepperdine University. Pepperdine University shall not be liable for any

errors, omissions or delays in Index content, or for any actions taken in reliance thereon.

22

This research was made possible with the support of Dun & Bradstreet Credibility Corp., the leading provider of credit

building and credibility solutions for businesses.

DUN & BRADSTREET CREDIBILITY CORP.Jeffrey Stibel, Chairman and Chief Executive Officer

Judy Hackett, Chief Marketing OfficerAaron Stibel, Senior Vice President, Technology

Liz Gengl, Director, Marketing and CommunicationsBrenda Gary, Vice President, Marketing Operations

Lauren Simpson, Marketing and Communications ManagerBernice Brennan, Manager, Creative Services & Marketing Communications

Trenice Taylor, Marketing Manager

33

ACKNOWLEDGEMENTS

I’d also like to thank the following people at The Graziadio School of Business and Management for their contributions:

Dean Linda LivingstoneAssociate Dean David M. Smith

Mike Sims, Executive Officer, CERJohn K. Paglia, Associate Professor of Finance

Douglass Gore, Director of Public RelationsMark Chun, Director, Center for Applied Research

Bill Bleuel, Professor of Decision Sciences Irina Shaykhutdinova, Research Analyst

and consultant, Simon James, Ph.D.

44

I. About the Private Capital Access (PCA) Index……...….…5

II. Demand for external financing……………………..….….14

III. Accessibility/success rate of raising new capital……...…21

IV. Satisfaction rates for various capital sources………..…..29

V. Expected demand for external financing……………..…..34

VI. Expected capital access (success) rates……………..….39

VII. Hiring/growth outlooks and financing failure impacts…45

VIII.About the respondents…………………………………..…54

Outline

55

The Pepperdine Private Capital Access Index (PCA) and Private

Capital Demand Index (PCD) are quarterly indicators produced by the

Graziadio School of Business and Management at Pepperdine

University, and with the support of Dun & Bradstreet Credibility Corp.

The index is designed to measure the demand for, activity, and health

of the private capital markets. The purpose of the two indices is to

gauge the demand of small and medium-sized businesses for financing

needs, the level of accessibility of private capital, and the transparency

and efficiency of private financing markets.

I. About the Private Capital Access

(PCA) Index

66

• 30 questions

• Invite to participate distributed to sample from Dun& Bradstreet Credibility Corp.’s business database

• 3,175 completed responses

• Where relevant, responses are segmented byrevenues sizes (<$5 million; $5 million to $100million)

• Responses collected from Oct 15 – Nov 6

About the Q3 2013 Private Capital

Access (PCA) Index Survey

77

Private Capital Access (PCA) and Private Capital

Demand (PCD) Index Results – Whole Sample

Total Market PCA Index PCD Index

2012-Q2 27.8 37.0

2012-Q3 27.0 36.5

2012-Q4 27.3 35.1

2013-Q1 25.6 32.7

2013-Q2 26.8 33.4

2013-Q3 27.5 31.7

2013-Q4 27.8 32.8

Change 0.3 1.1

Pct. Change 1.0% 3.6%

88

Private Capital Access (PCA) and Private Capital

Demand (PCD) Index Results – Whole Sample

2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3

PCA Index 27.8 27.0 27.3 25.6 26.8 27.5

PCD Index 37.0 36.5 35.1 32.7 33.4 31.7

0

10

20

30

40

50

60

70

80

90

100

99

Small Business PCA and PCD Index Results

(< $5M in Revenues)

Total Market PCA Index PCD Index

2012-Q2 26.6 38.8

2012-Q3 26.0 38.0

2012-Q4 26.3 36.5

2013-Q1 24.6 33.2

2013-Q2 26.3 34.3

2013-Q3 26.8 32.3

2013-Q4 26.6 33.9

Change -0.2 1.6

Pct. Change -0.6% 5.0%

1010

Small Business PCA and PCD Index Results

(< $5M in Revenues)

2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3

PCA Index 26.6 26.0 26.3 24.6 26.3 26.8

PCD Index 38.8 38.0 36.5 33.2 34.3 32.3

0

10

20

30

40

50

60

70

80

90

100

1111

Lower Middle Market PCA and

PCD Index Results

($5M – $100M in Revenues)

Total Market PCA Index PCD Index

2012-Q2 34.7 32.3

2012-Q3 33.5 33.1

2012-Q4 32.7 31.5

2013-Q1 31.9 30.6

2013-Q2 34.3 28.7

2013-Q3 34.7 27.6

2013-Q4 33.7 26.3

Change -1.0 -1.3

Pct. Change -2.9% -4.7%

1212

Lower Middle Market PCA and PCD Index

Results

($5M – $100M in Revenues)

2012-Q2 2012-Q3 2012-Q4 2013-Q1 2013-Q2 2013-Q3

PCA Index 34.7 33.5 32.7 31.9 34.3 34.7

PCD Index 32.3 33.1 31.5 30.6 28.7 27.6

0

10

20

30

40

50

60

70

80

90

100

1313

Annual Revenue Change Expectations

by Revenue Size

Q3, 2012 Q4, 2012 Q1, 2013 Q2, 2013 Q3, 2013 Q4, 2013

Whole sample 7.3% 5.8% 6.4% 6.2% 5.4% 7.0%

< $5 million 7.1% 5.7% 5.9% 6.3% 5.2% 7.0%

$5 -$100 million 7.8% 6.7% 7.1% 5.3% 6.5% 8.1%

5%

6%

7%

8%

9%

10%

1414

II. Demand for external financing

1515

Demand for Financing by Purpose and Size

(% with any need reported)

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Planned

growth or

expansion,

including

acquisitions

(not yet

realized)

Working

capital

fluctuations

Growth due

to increased

demand

(already

realized)

Finance

worsening

operating

conditions

Refinance

existing loans

or equity

Withdraw

wealth for

owners

Whole sample 52.3% 51.5% 45.1% 34.7% 29.4% 23.1%

< $5 million 52.4% 52.4% 45.4% 36.2% 29.6% 23.0%

$5 -$100 million 53.8% 45.6% 44.0% 25.5% 27.1% 23.8%

1616

Strength of Demand for Financing

(among those indicating demand)

Scale 1-4: slight, moderate, high, extremely high need

0.0

1.0

2.0

3.0

4.0

Planned

growth or

expansion,

including

acquisitions

(not yet

realized)

Refinance

existing loans

or equity

Working

capital

fluctuations

Growth due to

increased

demand

(already

realized)

Finance

worsening

operating

conditions

Withdraw

wealth for

owners

Whole sample 2.4 2.3 2.2 2.1 2.1 2.0

< $5 million 2.4 2.3 2.2 2.1 2.2 2.0

$5 -$100 million 2.1 2.1 2.0 1.9 2.0 2.0

1717

Respondents Indicating High and Extremely

High Demand for Financing

(among those indicating demand)

0%20%40%60%80%

100%

Planned

growth or

expansion,

including

acquisitions

(not yet

realized)

Refinance

existing

loans or

equity

Working

capital

fluctuations

Finance

worsening

operating

conditions

Growth due

to increased

demand

(already

realized)

Withdraw

wealth for

owners

Whole sample 43.9% 42.0% 36.9% 36.1% 35.3% 31.7%

< $5 million 45.9% 42.6% 38.0% 36.6% 36.7% 32.0%

$5 -$100 million 29.6% 35.1% 31.2% 27.3% 23.7% 26.7%

1818

Percentage Indicating “Yes” to “Is the current

business financing environment restricting…”

0%

20%

40%

60%

80%

100%

Growth opportunities for your business? Your ability to hire new employees?

58%

48%

60%

50%44%

33%

Whole sample < $5 million $5 -$100 million

1919

Trade Accounts (Accounts Receivable) Payment

Period Trends Over the Past Three Months

0%

20%

40%

60%

80%

100%

Accelerated (receiving

payments from customers

faster than three months

ago)

Slowed (receiving payments

from customers slower than

three months ago)

Stayed the same

8.3%

30.3%

61.4%

8.3%

31.1%

60.6%

9.3%

27.0%

63.7%

Whole sample < $5 million $5 million -$100 million

2020

Percentage of Respondents Who Attempted

to Raise Outside Financing

in the Last Three Months

0%

20%

40%

60%

80%

100%

Whole sample < $5 million $5 -$100 million

28% 28% 32%

2121

III. Accessibility/success rate

2222

Is it Difficult or Easy to Raise

New External Financing?

Equity financing Debt financing

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Difficult Neither

difficult

nor

easy

Easy

Whole sample 66.5% 15.8% 17.7%

< $5 million 68.8% 16.1% 15.1%

$5 -$100 million 53.2% 13.2% 33.6%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Difficult Neither

difficult

nor easy

Easy

Whole sample 65.2% 15.5% 19.4%

< $5 million 68.7% 15.3% 16.0%

$5 -$100 million 45.3% 16.6% 38.1%

2323

Financing Success Rates by Type and Business

Size for Prior Three Months

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 72% 31% 29% 14% 6% 63% 65% 53% 63% 57% 42% 17% 25% 40% 18% 15% 23% 12% 5%

< $5 million 71% 30% 28% 13% 7% 61% 63% 52% 62% 51% 34% 15% 21% 40% 15% 8% 18% 7% 5%

$5 -$100 million 76% 42% 25% 33% 0% 81% 85% 63% 75% 81% 75% 28% 50% 60% 44% 60% 60% 38% 0%

2424

Percentage of Those Who Attempted to Raise

Financing by Type of Financing for Prior Three

Months

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 41.2% 30.3% 15.8% 12.6% 12.4% 36.0% 41.8% 42.7% 49.9% 28.5% 57.1% 29.3% 32.7% 19.0% 16.1% 15.6% 15.8% 10.4% 9.4%

< $5 million 43.1% 32.3% 17.2% 13.6% 13.6% 36.9% 46.1% 44.7% 53.6% 28.4% 55.1% 31.0% 33.2% 20.1% 17.1% 16.5% 16.5% 10.4% 10.4%

$5 -$100 million 34.0% 14.2% 5.7% 7.5% 5.7% 34.0% 20.8% 32.1% 32.1% 28.3% 71.7% 19.8% 31.1% 13.2% 11.3% 11.3% 12.3% 9.4% 3.8%

2525

Main Purpose for Raising or Attempting

to Raise Financing

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Growth or

expansion

(incl.

acquis.)

Working

capital

fluctuations

Replacing

equipment

or facilities

unrelated

to growth

or

expansion

Refinancing

existing

loans or

equity

Finance

worsening

operations

conditions

Withdraw

wealth for

owners

Other

Whole sample 39.3% 29.5% 11.1% 9.6% 5.0% 0.8% 4.6%

< $5 million 38.7% 31.1% 10.4% 9.2% 5.6% 0.3% 4.7%

$5 -$100 million 43.4% 22.6% 11.3% 14.2% 2.8% 3.8% 1.9%

2626

Reasons for Businesses Not Attempting to Raise

External Financing (Multiple Selections)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Enough

cash flow

Sufficient

financing

in place

Weak

economy

Business

would be

rejected

Lack of

expertise

Not

enough

time

Waiting

for

cheaper

financing

Loss of

control /

flexibility

Cease

operation

/

liquidate

Other

Whole sample 51% 25% 18% 17% 10% 9% 6% 4% 1% 8%

< $5 million 49% 23% 18% 19% 11% 9% 6% 4% 2% 8%

$5 -$100 million 66% 39% 12% 7% 3% 4% 6% 3% 0% 5%

2727

Percentage of Owners Who Transferred

Personal Assets to Business

Over Prior Three Months

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No Unsure

37%

61%

1%

40.0%

58.9%

1.1%

19.3%

80.4%

0.3%

Whole sample < $5 million $5 -$100 million

2828

Types of Personal Assets Transferred to Business

During Prior Three Months

(Multiple Selections)

0%

20%

40%

60%

80%

100%

Personal

savings /

investments

Personal

credit card

purchases

Personal loan Cash from the

sale of

personal

assets

Home equity

loan

Other

Whole sample 74% 43% 18% 22% 9% 5%

< $5 million 74% 44% 18% 22% 8% 5%

$5 -$100 million 77% 33% 20% 23% 18% 5%

2929

IV. Satisfaction rates

3030

Pricing and Contract Terms Satisfaction Rates

(for those with a successful raise)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 89% 92% 81% 80% 33% 87% 48% 69% 66% 79% 85% 79% 71% 50% 79% 70% 71% 33% 50%

3131

General Financing Process Satisfaction Rates

(by Outcome)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Successful 74% 79% 84% 70% 0% 80% 58% 54% 69% 77% 75% 70% 60% 51% 60% 58% 67% 29% 33%

Unsuccessful 26% 17% 13% 7% 5% 24% 17% 13% 18% 19% 9% 15% 10% 18% 11% 13% 14% 9% 9%

3232

Percentage of Those Satisfied with Time Elapsed

from Point of First Contact until Funds Were

Received (for those successful raises)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,

etc.)

Crowd

funding

Presale/

Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Whole sample 76% 63% 84% 80% 50% 80% 71% 60% 77% 79% 69% 67% 72% 55% 64% 64% 75% 33%

3333

Percentage of Those Unsuccessful Who Feel the

General Category of Financing is a Still a Good

Fit for Their Business

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 29% 63% 46% 45% 30% 58% 36% 47% 57% 51% 66% 62% 58% 44% 52% 49% 41% 41% 41%

3434

V. Expected demand for external

financing

3535

Percentage of Businesses Planning to Raise

Financing in the Next Six Months

0%

20%

40%

60%

80%

100%

Yes No Unsure

28%

54%

18%

29%

53%

19%24%

64%

12%

Whole sample < $5 million $5 million -$100 million

3636

Percentage of Respondents Indicating Demand

for New Financing in the Next Six Months

0%

20%

40%

60%

80%

100%

Planned

future

growth or

expansion

Expected

working

capital

fluctuations

Growth due

to expected

increased

demand

Expected

worsening

operating

conditions

Refinance

existing

loans or

equity

Withdraw

wealth for

owners

Whole sample 54% 50% 47% 31% 29% 19%

< $5 million 54% 51% 48% 32% 29% 20%

$5 million -$100 million 51% 40% 40% 22% 23% 16%

3737

Strength of Expected Demand for New External

Financing in the Next Six Months

(Scale 1-4: Slight, Moderate, High, Extremely High)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Refinance

existing

loans or

equity

Planned

future

growth or

expansion

Expected

working

capital

fluctuations

Growth due

to expected

increased

demand

Expected

worsening

operating

conditions

Withdraw

wealth for

owners

Whole sample 2.4 2.3 2.2 2.2 2.1 2.1

< $5 million 2.4 2.4 2.2 2.3 2.1 2.1

$5 million -$100 million 2.3 2.0 2.0 1.9 1.9 2.0

3838

Respondents Indicating High or Extremely High

Expected Demand for New External Financing in

the Next Six Months

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Planned

future

growth or

expansion

Refinance

existing

loans or

equity

Growth due

to expected

increased

demand

Expected

working

capital

fluctuations

Withdraw

wealth for

owners

Expected

worsening

operating

conditions

Whole sample 43.5% 43.3% 37.7% 36.3% 33.8% 32.6%

< $5 million 45.6% 44.3% 39.6% 38.0% 35.5% 33.6%

$5 million -$100 million 26.1% 33.9% 22.4% 23.5% 27.0% 25.9%

3939

VI. Expected access rates

4040

Do You Expect It Would Be Easy or Difficult to

Raise New Financing in the Next Six Months?

Equity financing Debt financing

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Difficult Neither

difficult

nor

easy

Easy

Whole sample 65.5% 14.3% 20.2%

< $5 million 67.8% 13.9% 18.3%

$5 -$100 million 50.4% 17.4% 32.2%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Difficult Neither

difficult

nor easy

Easy

Whole sample 63.1% 13.9% 22.9%

< $5 million 66.5% 13.6% 20.0%

$5 -$100 million 42.6% 16.3% 41.1%

4141

Likely Sources of Financing

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 35% 38% 35% 19% 10% 8% 25% 33% 43% 33% 60% 36% 32% 17% 24% 22% 24% 13% 7%

4242

Main Purpose for Raising Expected Financing

0%

20%

40%

60%

80%

100%

Growth or

expansion

(incl.

acquisition)

Working

capital

fluctuations

Replacing

equipment

or facilities

unrelated

to growth

or

expansion

Refinancing

existing

loans or

equity

Finance

worsening

operations

conditions

Withdraw

wealth for

owners

Other

Whole sample 54.5% 21.2% 7.6% 8.6% 2.5% 1.0% 4.5%

< $5 million 54.3% 22.0% 7.0% 8.8% 2.5% 0.9% 4.5%

$5 -$100 million 56.3% 15.0% 13.8% 8.8% 3.8% 1.3% 1.3%

4343

Level of Confidence for Successful Financing(Scale 0-4: none; some; moderately; very; completely)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Friends

and

family

Grants

(SBIR,

STTR,etc.)

Crowd

funding

Presale/Donate

Crowd

funding

(Equity)

Crowd

funding

(Debt)

Trade

credit

Credit

card -

pers.

Loan -

pers.

Credit

card -

biz.

Lease Bank

loan -

biz.

CDFI/

Credit

union

Asset

based

lender

Factor Angel

capital

Vent.

capital

Private

equity

group

Mezz.

lender

Hedge

fund

Whole sample 2.1 1.6 2.1 1.6 1.3 1.0 2.1 1.6 1.9 2.2 1.6 1.3 1.4 1.9 1.3 1.4 1.5 1.1 1.3

< $5 million 2.1 1.6 2.1 1.6 1.2 1.1 2.1 1.6 1.9 2.1 1.5 1.3 1.3 1.9 1.3 1.3 1.4 1.0 1.2

$5 -$100 million 2.1 1.6 2.2 1.6 1.5 0.5 1.9 1.6 1.6 3.0 2.2 1.5 1.8 1.5 1.1 1.6 1.9 1.3 2.5

4444

Reasons for Not Planning on Raising Financing

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Enough

cash flow

Sufficient

financing

in place

Weak

economy

Business

would be

rejected

Lack of

expertise

Not

enough

time

Waiting

for

cheaper

financing

Loss of

control /

flexibility

Cease

operation

/

liquidate

Other

Whole sample 51% 25% 18% 17% 10% 9% 6% 4% 1% 8%

< $5 million 49% 23% 18% 19% 11% 9% 6% 4% 2% 8%

$5 -$100 million 66% 39% 12% 7% 3% 4% 6% 3% 0% 5%

4545

VII. Hiring / growth outlooks and

financing failure impacts

4646

Number of Employees Planned to Be Hired in

the Next Six Months

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0 1-2 3-5 6-10 11-15 16-20 21-30 31-40 41-50 76 -

100

101 -

200

More

than

200

Whole sample 45% 30% 14% 5% 2% 1% 1% 1% 0% 0% 0% 0%

< $5 million 47% 31% 13% 5% 1% 1% 1% 0% 0% 0% 0% 0%

$5 million -$100 million 27% 22% 22% 13% 6% 2% 2% 3% 2% 1% 1% 1%

4747

Impacts of Unsuccessful Financing Event in the

Next Six Months for Those Planning to Raise

Capital (Multiple selections)

0%

20%

40%

60%

80%

100%

Slower business

growth

Hire fewer new

employees than

planned

Reduce number

of employees

(layoffs)

Sell business

assets or shut

down

No expected

impacts on

growth,

business size,

or hiring plans

Whole sample 67% 53% 20% 17% 16%

< $5 million 67% 53% 20% 18% 16%

$5 million -$100 million 63% 51% 18% 11% 19%

4848

Annual Revenues Change for Last 12 Months:

Whole Sample

-0.5%

6%

2%3%

4% 4%3%

5%3% 3%

23%

8%7%

8%

4% 4% 4%3%

2%

5%

-4%

1%

6%

11%

16%

21%

26%

Decline Increase

4949

Annual Revenues Change for Last 12 Months :

Revenues Under $5M

-1.2%

7%

2%3%

4% 4%3%

5%

3% 3%

24%

8%

6%7%

4% 3% 3%3%

2%

5%

-4%

1%

6%

11%

16%

21%

26%

Decline Increase

5050

Annual Revenues Change for Last 12 Months :

Revenues from $5M to $100M

4%

2% 2%2%

4%

2%3% 3%

3%

17%

8%

10%11%

7%

6%7%

3%

1%

6%

4.2%

-4%

1%

6%

11%

16%

21%

Decline Increase

5151

Annual Revenue Change Expectations

(Next 12 Months): Whole Sample

2%

1% 1% 2% 2% 2%3%

1%3%

23%

14%

9%10%

7%6%

4%

2% 2%

7% 7.0%

-4%

1%

6%

11%

16%

21%

26%

Decline Increase

5252

Annual Revenue Change Expectations

(Next 12 Months): Revenues Under $5M

1% 1% 1% 2%2% 3%

1%2%

24%

14%

9%10%

7%6%

4%

2% 2%

8%7.0%

-4%

1%

6%

11%

16%

21%

26%

Decline Increase

5353

Annual Revenue Change Expectations

(Next 12 Months): Revenues $5M to $100M

1%1%

3%

2%1%

2%2%

4%

17%

12%

8%

14%

11%

8%

3%4%

2%

5%

8.1%

-4%

1%

6%

11%

16%

21%

Decline Increase

5454

VIII. About the Respondents

5555

Details About the RespondentsGeographic Location

Less than or equal to 1011 - 2526 - 5051 - 7576 - 100101 - 150151 - 200more than 200

CA

OR

WA

MT ND MN

ID

WY

SD

NV

UT

AZ

CO

NM

TX

NE

KS

OK AR

LA

MS AL

FL

GA

TN SC

NC

VA WV

KY MO

IL

IA

WI MI

IN OH

MD

PA NJ

NY

ME

NH VT

MA

RI CT

HI AK

5656

Details About the RespondentsPercentage of Respondents Who Feel Their State Supports

Business Policies That Benefit Their Business

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No

51% 49%

5757

Details About the RespondentsPercentage of Respondents Who Feel Their State Should Be

More Involved in Making Capital More Accessible to

Businesses

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No

68%

32%

5858

Details About the RespondentsPercentage of Respondents Who Feel That They Have Access

to Information about Available Capital Programs That Their

Business Could Be Participating in Their State Today

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No

44%

56%

5959

Details About the Respondents

Industry

32%

10%

9%9%

7%

7%5%

4%3%3%

4% 3% 3% 1%

Services

Construction

Retail trade

Finance & real estate

Manufacturing

Information technology or services

Health care

Wholesale trade

Unclassified establishments

Educational services

Arts, entertainment or recreation

Transportation and warehousing

Forestry, fishing, hunting or agriculture

Utilities & mining

6060

Details About the Respondents

Annual Revenues

27%

27%12%

19%

5%4%

2% 1% 3% $1 - $100,000

$100,001 - $500,000

$500,001 - $1,000,000

$1,000,001 - $5,000,000

$5,000,001 - $10,000,000

$10,000,001 - $25,000,000

$25,000,001 - $50,000,000

$50,000,001 - $100,000,000

$100,000,001 - $500,000,000

6161

Details About the Respondents

Annual Income

7%

53%

28%

5% 6%

1% Negative (net loss)

$0 - $100,000

$100,001 - $500,000

$500,001 - $1,000,000

$1,000,001 - $5,000,000

More than $5,000,000

6262

Details About the Respondents

Firm age

6% 6%6%

8%

15%

22%

37%

Less than 1 year

At least 1 but less than 2

At least 2 but less than 3

At least 3 but less than 5

At least 5 but less than 10

At least 10 but less than 20

20 or more

6363

Details About the Respondents

Number of Employees

37%

23%

15%

7%

3% 4%4%3%

2% 2% 1-2 3-5

6-10 11-15

16-20 21-30

31-50 51-100

101-200 More than 200

6464

About Pepperdine Private Capital Markets ProjectThe Pepperdine Private Capital Markets Project at the Graziadio School of Business and Management is the first simultaneous, comprehensive, and on-going investigation of the major private capital market segments. The research seeks to understand the true cost of private capital across market types and the investment expectations of privately-held business owners; providing lenders, investors and the businesses that depend on them with critical data to make optimal investment and financing decisions, and better determine where the opportunities to create lasting economic value may be realized. Download reports and find more information at http://bschool.pepperdine.edu/privatecapital.

About Pepperdine University’s Graziadio School of Bu siness and Management Founded on the core values of integrity, stewardship, courage, and compassion, Pepperdine University’s Graziadio (GRAT-ZEE-ah-DEE-oh) School of Business and Management has been developing values-centered leaders and advancing responsible business practice since 1969. Student-focused, experience-driven, and globally-oriented, the Graziadio School offers fully accredited top-ranked MBA, Masters of Science, and bachelor’s completion business programs. More information found at http://bschool.pepperdine.edu/newsroom/.

6565

THANK YOU!

Craig Everett, Ph.D., MBA Director, Pepperdine Private Capital Markets Project

http://bschool.pepperdine.edu/privatecapitalcraig.everett@pepperdine.edu

310.506.8543