Funding Continuum for Private Business Owners: Evidence from the Pepperdine Private Capital Markets Project Survey

Maretno A. Harjoto and John K. Paglia
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Maretno A. Harjoto: Pepperdine University
John K. Paglia: Pepperdine University

Journal of Entrepreneurial Finance, 2011, vol. 15, issue 2, 1-22

Abstract: The Pepperdine Private Capital Markets Project survey for business owners, administered during the spring of 2010, reveals an increasingly important role of friends and family (Friends/Family) to provide capital for privately-held businesses. Examining business owners’ perceptions of their sources of capital reveals that, overall, business owners prefer Friends/Family and angel financing as well as asset-based lenders and banks (ABL/Bank). Business owners consider Friends/Family financing to be the least costly. However, business owners also believe venture capital (VC), private equity (PE), and angels provide more benefits than friends/family and ABL/Bank. This study unveils a detailed spectrum of the funding continuum for privately owned firms across different levels of firms’ size, age, and information availability.

Keywords: Funding continuum; private capital markets; business owners’ impressions (search for similar items in EconPapers)
JEL-codes: G10 G20 G24 G31 (search for similar items in EconPapers)
Date: 2011
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