According to NAHB, roughly 127,000 construction firms (20.1 percent) said in a recent survey that they raised less than $5,000 to begin commercial activity.
This finding comes from the Annual Survey of Entrepreneurs from the U.S. Census Bureau, and incorporates the responses of 638,839 construction firms, along with companies in other industries.
The share of firms that are light on start-up capital is boosted by the number of specialty trade contractors. The ASE does not differentiate companies within construction, but NAHB estimates that two-thirds of the firms are contractors.
When it comes to start-up capital, 65 percent of respondents said that they used personal savings as a source, and roughly 18 percent said they used either a credit card or home equity.
The median amount of capital construction firms need to start their businesses is $33,529, which is $43,000 less than the median amount used by all industries, $77,227.
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