Newsletters
Financing access emerges as the biggest challenge for Türkiye’s entrepreneurs, with 71% citing it as a key obstacle as companies increasingly rely on their own resources to fund investments, according to a report.
A report by Ernst & Young covering over 1,000 family business owners, startup founders, and business leaders across Central Europe shows that economic uncertainty ranks almost as high, at 70%, while regulatory complexity is cited by 45% of respondents.
Businesses also point to economic risk and market uncertainty, insufficient financing, and high interest rates as major factors limiting investment, at 71%, 52%, and 41%, respectively.
Companies are increasingly funding investments through their own resources. Equity accounts for 61% of financing sources, compared with 20% for loans and 14% for incentives and grants, according to the research.
The financing pressure comes as companies take a more selective approach to investment while maintaining their growth ambitions. Businesses in Türkiye allocate relatively less to growth investments than the regional average and instead prioritize modernization and automation.
Information technology investments account for 50%, followed by automation at 45%, equipment at 36%, and new facilities at 13%.
Meanwhile, 18% of respondents report having no investment plans, a share that is above the regional level.
The financing constraints do not stop businesses from adopting new technologies. Artificial intelligence and machine learning lead technology use in Türkiye at 82%, followed by data analytics at 79%, digital customer experience platforms at 70%, and cloud technologies at 63%.
Innovation remains broad-based, with strategy and marketing innovation reaching 50%, product and process innovation 48%, and organizational innovation 45%.
Only 5% of respondents report having no innovation plans, unchanged from the previous year.
Respondents report that innovation has a 71% impact on performance, while the speed of technology adoption reaches 70%. Its reported impact on revenue growth, however, stands at 36%.
The share of full-time hiring falls to 34% from 44% a year earlier, while external collaborations and part-time hiring increase.
Compensation difficulties are the leading hiring challenge at 41%, followed by difficulties in meeting candidate expectations at 30% and competition with large companies at 25%.
At the same time, sentiment toward Türkiye’s entrepreneurship ecosystem improves. Positive assessments rise to 34%, while negative assessments fall from 51% to 25%.
EY Türkiye partner Muge Tan Belviso described the environment as one of more selective growth, with entrepreneurs becoming more selective in growth, investment, and transformation decisions.
"Progress in these areas will not only make entrepreneurs more resilient to current uncertainties but will also enable them to strengthen their competitiveness in local and global markets," Belviso said, referring to gradual growth, protecting profitability and liquidity, financial risk management, converting customer value into revenue, and developing flexible talent strategies.
EY Türkiye partner Ferzan Ulgen highlighted Türkiye’s focus on technology and AI, saying the ecosystem remains above the average of participating countries.
"Future successful entrepreneurs will be those who can adapt quickly to change, adopt the right talent strategies, and put talent at the center while integrating technology and artificial intelligence into their processes,” Ulgen said.
Set as preferred source
Set as preferred source
1 min read
1 min read
