A capital partnership: how human and venture capital affect the growth of high‐tech start‐ups

Colombo, Massimo G.; Grilli, Luca

doi:10.1002/jsc.850

Cited by 28 publications

(20 citation statements)

References 36 publications

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“…Accelerators play an important role in facilitating connections between firms and sources of entrepreneurial finance (OECD, 2013). Access to venture capital (VC), in particular, is seen as critical for the successful development of high performing ventures (Lerner, 2010), as some play an important role in mentoring businesses, providing them with contacts and enabling them to connect with customers (Colombo and Grilli, 2009). This is the kind of 'smart' money brings with it an array of ancillary benefits which positively benefit a firm.…”

Section: Programme Interventionsmentioning

confidence: 99%

Targeted support for high growth firms: Theoretical constraints, unintended consequences and future policy challenges

Brown

Mawson

2016

Environ Plann C Gov Policy

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High growth firms are now a major focus within enterprise policy. This paper provides a theoretically informed analysis of the rationale and effectiveness of targeted public sector support designed to develop these firms. Drawing on empirical research undertaken in the UK, this paper challenges the appropriateness of the theoretical assumptions embodied in these state-backed support instruments. It outlines the nature of these programmes and provides a critique of some of their inherent weaknesses, revealing that the assumptions underpinning these programmes are often flawed. The paper examines the limitations of their selection procedures, the thematic nature of support and exit dynamics. It found that offering early stage firms intensive levels of resources may have important (and detrimental) unintended consequences previously overlooked by policy makers. The paper offers some suggestions for how policy instruments could be better attuned to the needs of these growth-oriented firms.

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Section: Programme Interventionsmentioning

confidence: 99%

Targeted support for high growth firms: Theoretical constraints, unintended consequences and future policy challenges

Brown

Mawson

2016

Environ Plann C Gov Policy

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“…VC is a possible solution to this problem (Colombo and Grilli, 2009). VC financing provides startups with resources and opportunities to innovate with new business models.…”

Section: Introductionmentioning

confidence: 99%

Impact of intellectual capital on the financing of startups with new business models

Nigam¹,

Mbarek

Boughanmi

2020

JKM

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Purpose Financing investments in a knowledge-intensive sector may be more difficult as there is a greater degree of uncertainty and asymmetries of information. This paper aims to examine whether a company’s intellectual capital (human capital, relational capital and structural capital) can serve as a quality signal in the financing of health care startups with new business models. Design/methodology/approach The study constructed a manual database using several paid and unpaid databases. This paper collected random data from 204 startups that obtained funding during the 2014–2017 period and used signaling theory to examine the factors that impact access to external financing for Indian health care technology startups. Findings This paper found that venture capitalists partly base their financing decisions on the relational capital of the startup represented by startups’ age and the average number of website visits, the presence of a syndicate of investors. Human capital variables and structural variables do not show much significant impact. This paper also find some business models show a negative impact on financing implying that investors are reluctant to invest in new technologies that carry more uncertainty and take a longer time to become profitable. Research limitations/implications Before concluding this paper, it is important to acknowledge the limitations of the study and some implications for future research purposes. First, the study is conducted on only 204 startups from India, and as such, it suffers from a small sample size, like many other comparable survey-based studies in entrepreneurship. Second, the results are obtained with respect to data collected from Indian startups and represent the Indian context which limits the generalization on a global level. Practical implications The results suggest that years of experience and prior relevant experience, do not actually impact the financing of a new venture. These results are crucial as India has a unique demographic advantage over other countries in relation to age. If young minds are adequately nurtured, this can result in innovation, entrepreneurship and job creation (which still remains as a foremost challenge for India). Social implications From a policy perspective, a number of implications emerge from the current study. There is a need for ameliorating the capacity of the education system in providing top-quality support including a greater focus on entrepreneurship courses and to replicate the education delivery model from top foreign institutes. The government should take this opportunity to revive the system of education and follow the methodology of elite institutes and to develop entrepreneurship spirit in other colleges and schools. Originality/value Financing the investments of young startups with new business models in knowledge-based sectors may be more difficult. In this paper, this paper demonstrates that startups have to effectively use and manage their intellectual assets to achieve sustainable competitive advantage. The findings of the paper emphasize the role of intellectual capital in securing financing through venture capital.

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“…It is expected that companies that have workers with high levels of human capital can incorporate their production process more easily in emerging technologies to withdraw maximum efficiency. This situation is confirmed by Alvarez and Rodriguez (2011) and Colombo and Grilli (2009) who argued that several dimensions of human capital such as the entrepreneurs' level of formal education, training, and social networks are the determining factors in the sustainability and growth of companies in the market. Furthermore, human capital in companies can boost the development of research and development (R&D) activities by driving the creation of new products (Bodman & Le, 2013).…”

Section: Exploring the Role Of Education On The Entrepreneurial Motivmentioning

confidence: 70%

“…Although academic spin-offs are mostly entrepreneurs with high academic qualifications, the role and relevance assumed by the founder's education are not unanimous. Various studies revealed the relationship between entrepreneurial motivations and education levels, indicating that high qualification levels of entrepreneurs contributed to the establishment of new academic spin-offs (Colombo & Grilli, 2009;Gimmon & Levie, 2010). However, the findings by Teixeira and Castro (2015) suggested that high levels of education and existence of complementary technical education were statistically non-significant for the establishment of university spin-offs.…”

Section: Exploring the Role Of Education On The Entrepreneurial Motivmentioning

confidence: 99%

Exploring the Role of Education on the Entrepreneurial Motivations of Academic Spin-offs' Founders

Almeida¹

2019

J ENTREP BUS

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Academic spin-offs are increasingly assuming a relevant role in the social and economic contexts. However, only a few studies have looked at the specific role of human capital in these organisations. The contradictory dimension in human capital is the role of the founder's education, in which some studies have revealed the relationship between entrepreneurial motivation and education levels. Other studies indicated that these two variables are uncorrelated. Hence, this study seeks to explore and understand the reasons for these contradictory results by conducting case studies using indepth interviews on six Portuguese academic spin-offs. The findings have allowed us to understand causes and difficulties experienced by Ph.D. students to create new ventures. Furthermore, they also have allowed us to explore the importance of complementary professional and technical training in entrepreneurial motivations.

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A capital partnership: how human and venture capital affect the growth of high‐tech start‐ups

Cited by 28 publications

References 36 publications

Targeted support for high growth firms: Theoretical constraints, unintended consequences and future policy challenges

Targeted support for high growth firms: Theoretical constraints, unintended consequences and future policy challenges

Impact of intellectual capital on the financing of startups with new business models

Exploring the Role of Education on the Entrepreneurial Motivations of Academic Spin-offs' Founders

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