High-growth entrepreneurial firm funding: a qualitative study of native-born and immigrant entrepreneurs

Kaveh Moghaddam, Alexandre Aidov, Charles DuVal and Sara Azarpanah

Venture Capital, 2017, vol. 19, issue 1-2, 75-94

Abstract: This qualitative study explores the financing choices of high-growth entrepreneurial firms established by native-born and immigrant entrepreneurs. Native-born and immigrant entrepreneurs are shown to pursue different financing approaches and strategies. Native-born entrepreneurs pursue multiple sources of financing, while immigrant entrepreneurs tend to rely on a single source of funding. In contrast to immigrant entrepreneurs who suggest bootstrapping as their preferred choice of financing, native-born entrepreneurs recommend bootstrapping as an initial source of funding, to be supplemented later by other external financing sources (e.g. banks, VC funds, business angels). Furthermore, native-born entrepreneurs solicit loans from large banks, while immigrant entrepreneurs seek loans from small local (community) banks. Finally, native-born entrepreneurs actively seek equity-based financing such as venture capital and business angel financing, while immigrant entrepreneurs avoid equity financing.

Date: 2017
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DOI: 10.1080/13691066.2016.1256295

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