MultiStage selection and the financing of new ventures
Scott Shane and
Frédéric Delmar ()
Post-Print from HAL
Using a random sample of 221 new Swedish ventures initiated in 1998, we examine why some new ventures are more likely than others to successfully be awarded capital from external sources. We examine venture financing as a staged selection process in which two sequential selection events systematically winnow the population of ventures and influence which ventures receive financing. For a venture to eceive external financing its founders must first select it as a candidate for external funding, and then a financier must fund it. We find evidence that founders select ventures as candidates for external finance based on their perceptions of market competition, market growth, and employment growth, while financiers base funding decisions on objective verifiable indicators of venture development, such as the completion of organizing activities, marketing activities, and the level of sales of the venture. Our findings have implications for venture financing and evolutionary theories of social processes.
Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-02311635
References: Add references at CitEc
Citations: View citations in EconPapers (13) Track citations by RSS feed
Published in Management Science, 2006, pp.220-232 P
There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.
Journal Article: Multistage Selection and the Financing of New Ventures (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02311635
Access Statistics for this paper
More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().