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Start†up financing: How founders finance their ventures' early stage

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  • Peter Waleczek
  • Thomas Zehren
  • Tessa Christina Flatten

Abstract

Although the entrepreneurship literature has advanced our understanding of start†up financing, little is known about the mechanisms founders use to finance the beginning of a venture. Drawing upon resource†based view, this study relocates bootstrapping is a strategic choice rather than a necessity. By analysing the financial behaviour of 3,017 new business owners, we reveal owner†financed bootstrapping is a strategic choice rather than a necessity. We also demonstrate related techniques that are used independent of industry, initial capital, financing difficulties, and impeded revenues.

Suggested Citation

  • Peter Waleczek & Thomas Zehren & Tessa Christina Flatten, 2018. "Start†up financing: How founders finance their ventures' early stage," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 39(5), pages 535-549, July.
    • Handle: RePEc:wly:mgtdec:v:39:y:2018:i:5:p:535-549
    DOI: 10.1002/mde.2925
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    Cited by:

    1. Chen Zhao & Feng Feng, 2023. "Do parent organizations influence R&D decisions of academic spin‐offs?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 43-57, January.
    2. Franziska Schlichte & Sebastian Junge & Jan Mammen, 2019. "Being at the right place at the right time: does the timing within technology waves determine new venture success?," Journal of Business Economics, Springer, vol. 89(8), pages 995-1021, December.
    3. Pankaj C. Patel & Marcus T. Wolfe & Maria João Guedes, 2023. "The triple‐edged sword of sensitivity of sales, cash flows, and debt to investments: Venture survival and capital investments," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 473-489, January.
    4. A‐Reum Jung & Do‐Jin Jung, 2022. "The effects of size‐dependent policy on the sales distortion reporting: Focusing on the discretionary sales management of Korean SMEs," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(2), pages 301-320, March.
    5. Mincheol Choi & Chang‐Yang Lee, 2020. "The Peter Pan syndrome for small and medium‐sized enterprises: Evidence from Korean manufacturing firms," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(3), pages 426-445, April.
    6. Mansi Singh & Sanjay Dhir & Harsh Mishra, 2024. "Synthesizing research in entrepreneurial bootstrapping and bricolage: a bibliometric mapping and TCCM analysis," Management Review Quarterly, Springer, vol. 74(1), pages 487-520, February.
    7. Jinbo Wang & Maosheng Ran & Yi Li & Heng Zhan, 2022. "Is venture capital a catalyst for innovative entrepreneurship in China? Empirical analysis based on the PSM‐DID method," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(4), pages 1039-1058, June.

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