You can be on Entrepreneur’s cover!

'No, I'm Not Happy': Kevin O'Leary Warns of Impending 'Crisis' for Small Businesses Amid Inflation, Fed Rate Hikes The "Shark Tank" star sounded off on FOX's "The Big Money Show."

By Emily Rella

Key Takeaways

  • Kevin O'Leary joined FOX's "The Big Money Show" to talk about the future of small businesses
  • Fed rate hikes and inflation are affecting their ability to obtain financing
  • O'Leary suggests that they file for a certain tax credit amid the crisis
entrepreneur daily

Shark Tank star and O'Leary Ventures chairman Kevin O'Leary is sounding off on the impending "crisis" that lies ahead for small businesses.

O'Leary recently sat down on FOX's The Big Money Show to talk about Federal Reserve interest rate hikes and what it could mean for the future of financing for small local businesses.

In May, the Fed instated a 25-basis-point rate increase, which put the target rate range at 5% to 5.25% — the third 25-basis-point increase in a row this year.

Related: Kevin O'Leary Slams Martha Stewart's Comments on Remote Work: 'Nobody Wants to Work in These Places'

"These rapid rate hikes that have occurred, [the] unprecedented speed of these hikes, have put my small businesses [in crisis], and I'm talking about companies with five to 500 employees, which represent over 60% of our economy," O'Leary said on the show. "If you're in the S&P 500, you have no trouble financing your business. You can't say that about small businesses anymore. The cost of capital has gone through the roof."

Kevin O'Leary testifies during the Senate Banking, Housing, and Urban Affairs Committee hearing titled Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers. (Getty Images)

O'Leary also touched on the most recent National Federation of Independent Business (NFIB) report, which was released Tuesday and showed that small business optimism reached a seven-month high in June.

The Shark Tank star was still not impressed.

"I'm not listening to that data, I'm dealing with reality," he said bluntly, mentioning that he's been talking to small business owners and CEOs around the country. "We've got a real crisis coming here; there's no cash for small businesses. And when the Fed raises rates another 50 basis points, that's going to make it worse. So no, I'm not happy."

O'Leary suggested that small businesses apply for the employee retention credit as inflation continues to loom, a tax credit that was first implemented during the pandemic and is meant to encourage employers to retain employees and keep them on the payroll.

O'Leary recently gave his opinion on the future of work and took a firm stance that forcing employees to come back into the office full-time is detrimental to business.

"The economy has changed radically," he said on FOX's Outnumbered last month. "The problem with saying everybody has to work in the office is you won't be able to hire the best talent."

O'Leary's estimated net worth as of Wednesday morning was $400 million.

Emily Rella

Entrepreneur Staff

Senior News Writer

Emily Rella is a Senior News Writer at Entrepreneur.com. Previously, she was an editor at Verizon Media. Her coverage spans features, business, lifestyle, tech, entertainment, and lifestyle. She is a 2015 graduate of Boston College and a Ridgefield, CT native. Find her on Twitter at @EmilyKRella.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Resumes & Interviewing

Build a Better Resume with This $35 Subscription

AI Resume Builder promises to help you apply to jobs twice as fast.

Side Hustle

He Took His Side Hustle Full-Time After Being Laid Off From Meta in 2023 — Now He Earns About $200,000 a Year: 'Sweet, Sweet Irony'

When Scott Goodfriend moved from Los Angeles to New York City, he became "obsessed" with the city's culinary offerings — and saw a business opportunity.

Marketing

I Got Over 225,000 Views in Just 3 Months With Short-Form Video — Here's Why It's the New Era of Marketing

Thanks to our new short-form video content strategy, we've amassed over 225,000 video views in just three months. Learn how to increase brand awareness through short-form video content.

Business News

Samsung Makes 6 Day Workweeks Mandatory for Executives as the Company Enters 'Emergency Mode'

Samsung said its performance "fell short of expectations" last year. Now executives are required to work weekends.

Productivity

6 Habits That Help Successful People Maximize Their Time

There aren't enough hours in the day, but these tips will make them feel slightly more productive.

Leadership

You Won't Have a Strong Leadership Presence Until You Master These 5 Attributes

If you are a poor leader internally, you will be a poor leader externally.