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People Financing Entrepreneurs within and outside the Family: Pandemic Decline and Resilience in Cultures around the World

Author

Listed:
  • Ahmed Tolba

    (Department of Marketing, School of Business, American University in Cairo, New Cairo 11835, Egypt)

  • Ayman Ismail

    (Department of Marketing, School of Business, American University in Cairo, New Cairo 11835, Egypt)

  • Thomas Schøtt

    (Department of Marketing, School of Business, American University in Cairo, New Cairo 11835, Egypt)

Abstract

People may finance entrepreneurs, often family members. Here, the question is: how has the COVID-19 pandemic affected people’s funding of family-related entrepreneurs and non-family-related entrepreneurs? The pandemic predictably reduced the funding of family-related entrepreneurs and especially the financing of non-family-related entrepreneurs. However, a culture supportive of family businesses may alleviate the declining funding of family-related entrepreneurs, predictably, while a secular–rational culture supportive of non-family businesses may alleviate the declining financing of non-family-related entrepreneurs. Similar to a field experiment, a globally representative survey was conducted before and after the disruption in 42 countries, interviewing 266,983 adults either before or after the disruption. The individual-level data are combined with national-level data on culture, amenable to hierarchical linear modeling. People’s financing of family-related entrepreneurs and especially of non-family-related entrepreneurs are found to have declined with the COVID-19 pandemic. However, culture provides resilience, in that the declining funding of family-related entrepreneurs was alleviated where the culture supports family businesses, and the declining funding of non-family-related entrepreneurs was alleviated in societies with a secular–rational culture. The findings contribute to contextualizing business angel financing temporally, as embedded in time before and after the COVID-19 pandemic disruption, and societally, as embedded in culture providing resilience.

Suggested Citation

  • Ahmed Tolba & Ayman Ismail & Thomas Schøtt, 2021. "People Financing Entrepreneurs within and outside the Family: Pandemic Decline and Resilience in Cultures around the World," JRFM, MDPI, vol. 14(12), pages 1-18, December.
    • Handle: RePEc:gam:jjrfmx:v:14:y:2021:i:12:p:610-:d:703394
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