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Investment Readiness Programmes and Access to Finance: A Critical Review of Design Issues

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  • Colin Mason
  • Jennifer Kwok

Abstract

Access by SMEs to finance is constrained by demand-side weaknesses. Most businesses are not investment ready. Their owners are unwilling to seek external equity finance and those who are willing do not understand what equity investors are looking for or how to ‘sell’ themselves and their businesses to potential investors. These weaknesses, in turn, compromise the effectiveness of supply-side interventions, such as initiatives to stimulate business angels or which create public sector venture capital funds. This has highlighted the need for investment readiness programmes that seek to increase the pool of investable businesses. This paper reviews the design and delivery of investment readiness programmes in the UK and draws out lessons for best practice.

Suggested Citation

  • Colin Mason & Jennifer Kwok, 2010. "Investment Readiness Programmes and Access to Finance: A Critical Review of Design Issues," Local Economy, London South Bank University, vol. 25(4), pages 269-292, June.
    • Handle: RePEc:sae:loceco:v:25:y:2010:i:4:p:269-292
    DOI: 10.1080/02690942.2010.504570
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    References listed on IDEAS

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    2. Colin Mason & Richard Harrison, 2001. "'Investment Readiness': A Critique of Government Proposals to Increase the Demand for Venture Capital," Regional Studies, Taylor & Francis Journals, vol. 35(7), pages 663-668.
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    Cited by:

    1. Anoosheh Rostamkalaei & Mark Freel, 2016. "The cost of growth: small firms and the pricing of bank loans," Small Business Economics, Springer, vol. 46(2), pages 255-272, February.
    2. Motavaseli Mahmood & Shojaei Saeed & Bitaab Ali & Hasti Chitsazan & Ghanbar Mohammadi Elyasi, 2018. "Institutional Barriers to Financing Technology-based Small Firms through Venture Capital Mechanism: A Study to Explore the Incentives for Investment in Iran," International Journal of Economics and Financial Issues, Econjournals, vol. 8(1), pages 184-195.
    3. Bergner, Sören Martin & Bräutigam, Rainer & Evers, Maria Theresia & Spengel, Christoph, 2017. "The use of SME tax incentives in the European Union," ZEW Discussion Papers 17-006, ZEW - Leibniz Centre for European Economic Research.
    4. Gianni Romaní & Miguel Atienza & José Ernesto Amorós, 2013. "The development of business angel networks in Latin American countries: the case of Chile," Venture Capital, Taylor & Francis Journals, vol. 15(2), pages 95-113, April.
    5. Colombo, Massimo G. & D’Adda, Diego & Quas, Anita, 2019. "The geography of venture capital and entrepreneurial ventures’ demand for external equity," Research Policy, Elsevier, vol. 48(5), pages 1150-1170.
    6. Ana Paula Cusolito & Ernest Dautovic & David McKenzie, 2021. "Can Government Intervention Make Firms More Investment Ready? A Randomized Experiment in the Western Balkans," The Review of Economics and Statistics, MIT Press, vol. 103(3), pages 428-442, July.
    7. Dan van der Schans, 2015. "The British Business Bank's role in facilitating economic growth by addressing imperfections in SME finance markets," Venture Capital, Taylor & Francis Journals, vol. 17(1-2), pages 7-25, April.
    8. Karsai, Judit, 2015. "Állami szerepvállalás a kelet-közép-európai kockázatitőke-piacon [The role of government in the Central and East European venture-capital market]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(11), pages 1172-1195.
    9. Judit Karsai, 2015. "Are CEE states successful as venture capitalists?," CERS-IE WORKING PAPERS 1539, Institute of Economics, Centre for Economic and Regional Studies.

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