The failure to obtain VC financing in the pre-start-up phase: Evidence from the Portuguese context

Abstract

In this paper, we contribute to the literature on access to venture capital during the pre-start-up phase of innovative firms by identifying the reasons for failing to obtaining formal VC according to nascent entrepreneurs. The main reasons cited for not obtaining venture financing were the small size of the VC market and limited public policies to support venture capital participation. The sub-sample of nascent entrepreneurs who based their financing proposals on more complete business plans included “lack of interest of the venture capitalists in pre start-up phase investments” as the number one reason.

Venture Capital Financing as A Driver for Entrepreneurship Development in Africa. A Literature Review and Future Research Agenda

“…We also discover that :: IJEBD :: While 8% of the articles in question were published in 2020, e.g. Amorós et al, 2019, Mbedzi & Simatele, 2020Rossi et al, 2020;Bilau & Couto, 2012;Kato &Tsoka, 2020;Liang, 2020;Javadian et al, 2020) then 8% in 2019 and 6% of articles in 2018. A quick analysis reveals that over 60% of the article were published between 2016-2021.…”

A synthesized framework for the formation of startups’ innovation ecosystem

“…Moreover, estimating time and energy needed by startups to provide capital for them is very difficult, especially for explorer startups compared to exploiter ones (Gudanescu, 2009; Samuelsson and Davidsson, 2009). This is while, in the early stages of formation, banks and venture capitalists tend less to invest in startups (Bilau and Couto, 2012). On the contrary, private capital providers (Hussain et al , 2017), angel investors and informal finance providers (Bilau and Couto, 2012) have a more significant part at this stage.…”

“…This is while, in the early stages of formation, banks and venture capitalists tend less to invest in startups (Bilau and Couto, 2012). On the contrary, private capital providers (Hussain et al , 2017), angel investors and informal finance providers (Bilau and Couto, 2012) have a more significant part at this stage. In the case of managerial abilities, startups also suffer from serious weaknesses (Gudanescu, 2009) and require a wide range of business support and consultation.…”