Green start-up finance – where do particular challenges lie?

Abstract

Purpose The purpose of this paper is to shed some new light on the entrepreneurial finance of green start-ups, for which there has been little quantitative empirical evidence thus far. It explores what challenges green start-ups might experience when it comes to financial access. Design/methodology/approach The paper includes a survey of start-ups in Finland, Germany and Sweden and the separate evaluation of the “greenness” of participating companies’ product/service portfolios based on Eurostat’s Environmental Goods and Service Sector classification. A logistic regression is carried out for different company phases for two measures of challenges (“difficulty accessing finance” and “rejection by investor/funder”). Findings Green start-ups as an overall group cannot be said to have more challenges in access to finance. Particularly, a lack in business education and a high level of innovativeness, however, seem to be lead to more challenges for green start-ups in accessing finance compared to other start-ups. Research limitations/implications Further research might seek to identify which exact characteristics of innovative green start-ups lead to challenges in financial access, i.e. is it individual factors such as high risk levels, high investment sums, long development periods or a low return prospect – or is it rather a combination? It might, furthermore, be rewarding to investigate whether “interventions” of business-related training might reduce challenges. Social implications Suggestions are made for improved policy support to sustainable entrepreneurship in the case of green start-ups. Originality/value This research paper provides quantitative empirical analysis in a new research area, which has previously been predominantly theory based with some anecdotal observations as well as some early qualitative research.

Exploring Green Start-up Finance for Tourism Villages

“…The research was conducted in two stages [42]. The first stage was in-depth interview with tourism village administrators of 5 people and the interview materials sourced from Bergset [43].…”

Factores Financieros De La Eco Innovación en Procesos Y Organización Que Impactan en La Productividad Del Sector Agrícola Del Valle De San Quintín, Baja California, México (Financial Factors of Eco-Innovation in Processes and Organization That Impact the Productivity of the Agricultural Sector of the San Quintín Valley, Baja California, Mexico)

“…Los resultados obtenidos dentro de esta investigación coindicen con Bergset (2018), quien afirma que el desarrollo de la economía verde se da gracias a las empresas que emplean y adoptan prácticas ecológicas y en especial dentro de sus procesos considerándolos ecológicos, por tal motivo es importante que las empresas tengan un financiamiento directo para esta actividad para poder lograr culminar este cambio dentro de la organización.…”

Systematic Literature Review: Sustainability practices in Start-ups

“…Category Reference Key concepts 1. Characteristics of entrepreneurs (Schick, Marxen, & Freimann, 2002) Entrepreneur's behavior (Diochon, Menzies, & Gasse, 2008) Success factors (Hockerts & Wüstenhagen, 2010) Company size ( (Hasani, Bojei, & Dehghantanha, 2017) Success and failure factors (Antarciuc et al, 2018) Investors' behavior (Bergset, 2018) Investors' behavior Risk of failure (Valentin, Pînzaru, Vătămănescu, & Stanciu, 2015) Marketing (Malindretos, Tsiboukas, & Argyropoulou-Konstantaki, 2016) Waste management (Henry, Rushton, & Baillie, 2016) Sustainable business model (Antikainen & Valkokari, 2016) Sustainable business model (Franceschelli, Santoro, & Candelo, 2018) Sustainable business model 4. Impact of institutional support (Noyes, 2015) Sustainability education (Putri & Fujiwara, 2015) Investment as government support (Jagoda, Lin, Calvert, & Tao, 2016) Incubators ( Institutional support initiatives (Ge et al, 2016) Institutional support initiatives (Bank, Fichter, & Klofsten, 2017) Incubators (Kanda, Hjelm, Clausen, & Bienkowska, 2018) Institutional support initiatives (Sher, Mazhar, Zulfiqar, Wang, & Li, 2019) Market barriers (Demirel, Li, Rentocchini, & Tamvada, 2019) Sustainability factors in start-ups (Sunny & Shu, 2019) Institutional support initiatives…”

“…investigate the use of social customer relationship management (SCRM) in start-ups and seek to determine whether it is a factor of success or failure. The results that affect sustainability indicate that factors such as investment, crowd funding, government support and the support of business angels positively affect the decision to use SCRM (Bergset, 2018). indicates that start-ups that contribute to sustainability are sceptical of investment by third parties that have a different view of the business.…”