No abstract

In this study, conducted on behalf of the Federal Ministry of Finance, we provide the first comprehensive analysis of the German FinTech industry. We quantify the market volume of the industry between 2007 and 2015. On the basis of this data, we also predict the future development of eight segments of the FinTech market, offering detailed forecasts for the years 2020, 2025, and 2035. Moreover, we provide a comprehensive overview of current trends and the drivers of growth that have affected the FinTech industry in the past, as well as the factors that could spur and hinder growth within it in the future

The existence of host-country and country-of-origin effects is analysed by using the concept of fiscal federalism as a theoretical analogy. It is argued that multinationals try to minimize the costs of centralization and decentralization associated with cross-national personnel policy. The higher the costs of decentralization, the more likely is the existence of country-of-origin effects. The opposite holds true for increasing costs of centralization. This is tested empirically by comparing the human resource management and industrial relations (HRM/IR) practices of US and British subsidiaries operating in Germany with those of native German firms. Based on 297 valid cases, it is shown that the existence of decentralization costs is associated with country-of-origin effects in various areas of personnel management, such as the use of variable compensation, employee ownership and initial vocational training. In contrast, in the field of industrial relations (co-determination, compliance with collective bargaining), there are strong pressures to adapt to local norms, leading to host-country effects. These results indicate that a rationalistic cost-minimization approach is well suited to explaining the patterns of host-and home-country effects in regard to the HRM/IR practices of multinational enterprises.

Manuscript type Empirical Research question/issue Today, startups frequently obtain financing via the Internet through many small contributions of nonsophisticated investors. Yet, little is known whether these startups can ultimately build enduring businesses. This study investigates the determinants of follow‐up funding and firm failure after an equity crowdfunding campaign has taken place. Research findings/insights We use hand‐collected data from 13 different equity crowdfunding portals and 413 firms that ran at least one successful equity crowdfunding campaign in Germany or the United Kingdom between 2011 and 2016. Our findings show that German firms that received equity crowdfunding stood a higher chance of obtaining follow‐up funding through business angels or venture capitalists but also had a higher likelihood of failure. The number of senior managers and the number of initial venture capital investors both had a positive impact on obtaining postcampaign financing, whereas the average age of the senior management team had a negative impact. The number of initial venture capital investors and the valuation of the firm were significant predictors increasing the hazard of firm failure, whereas the number of senior managers and the amount raised during previous equity crowdfunding campaigns had a negative impact. Theoretical/academic implications This study provides some first empirical evidence regarding the firm and campaign characteristics that determine follow‐up funding and firm failure after an equity crowdfunding campaign has taken place. Given the absence of research on this topic so far, this study inevitably remains original and exploratory to some extent. The empirical findings suggest various avenues of research for human capital theory, organizational ecology, and the comparative corporate governance literature. Practitioner/policy implications Identifying influencing factors of follow‐up funding and firm survival is important to make this new and potentially welfare enhancing form of entrepreneurial finance more predictable by decreasing the risk of individual investments. Furthermore, this study offers insights to policy makers, which are currently expected to implement appropriate regulations for this new market segment. In addition, it provides important insights for portal managers as well as firms raising capital via equity crowdfunding, which may learn about their chances to build an enduring business. https://youtu.be/w_4lIfnOaQY