University of Twente Student Theses
How entrepreneurs decide on the type of financing for their ventures : A comparative analysis of factors influencing the choice between business angels and other funding options
Thuis, E.J. (2024) How entrepreneurs decide on the type of financing for their ventures : A comparative analysis of factors influencing the choice between business angels and other funding options.
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| Abstract: | In the ever-changing start-up environment, business angels can be used to bridge the equity gap. Despite their funding, approximately 95% of entrepreneurs seeking funding from business angels are rejected. To understand why entrepreneurs continue to seek funding from business angels despite these high rejection rates, this study addresses the following research question: “Why do entrepreneurs choose business angels instead of other types of funding?”. This research employs a mixed-methods approach, including a literature review and semi-structured interviews. A total of 11 semi-structured interviews were conducted with entrepreneurs, business angels and funding experts and analysed using the Gioia method. Both the literature and the interviews indicate that entrepreneurs choose business angels because alternative options for bridging the equity gap are limited and business angels offer 'smart money' rather than just financial support. Given the small sample size and reliance on semi-structured interviews, which may not fully represent broader perspectives, future research should use diverse recruitment methods and include both interviews and surveys to deepen the understanding of the relationship between business angels and entrepreneurs and to assess the long-term impact on start-up success. Keywords: business angels, entrepreneurs and start-ups. |
| Item Type: | Essay (Master) |
| Faculty: | BMS: Behavioural, Management and Social Sciences |
| Subject: | 85 business administration, organizational science |
| Programme: | Business Administration MSc (60644) |
| Link to this item: | https://purl.utwente.nl/essays/102093 |
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