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The aim of this paper is to make sense of the “funding gap” by exploring how and why informal entrepreneurial finance is made available to entrepreneurs. By challenging the epistemological and ontological assumptions of the “funding gap”, an enactment perspective of entrepreneurial finance, supported by a social constructionist stance, is proposed in this paper.

The study on which this paper reports was conducted through a longitudinal fieldwork process. Networks in two Chinese cities, Shanghai and Hong Kong, were chosen because of their differences in institutional context yet exceptionally high level of entrepreneurial activities.

This paper highlights the active role entrepreneurs play in managing their financial needs in the process of new venture creation. The results show that entrepreneurs are actively managing the demand as well as supply of entrepreneurial finance to narrow the “funding gap”. Furthermore, individuals work to fill the funding gap by creating required start‐up capital. In other words, the “funding gap” is not static or concrete; rather it is dynamic, manageable and in many cases is within individuals' power and ability to overcome.

The findings of this paper are particularly important to all stakeholders, including policy makers, educators, researchers, entrepreneurs and nascent entrepreneurs.

This paper contributes to the conceptual, methodological and practical knowledge in advancing understanding of the “funding gap”. First, it provides insight into the relationship between entrepreneurs and their environment that shapes the “funding gap”. Second, the findings suggested that a positive, supportive enterprise culture can be particularly useful in driving individuals towards entrepreneurship. Third, in terms of methodology, the author argues that an “inside‐looking‐lout”, interpretive, multi‐stage fieldwork and network as unit of analysis is particularly distinctive in revealing the complex process of managing entrepreneurial finance in the process of new venture creation.

Men founders raise almost 50× more venture capital (VC) than women. As 93 per cent of VCs are men, because of the significant gender imbalance in gatekeepers and investment decision-makers for early-stage capital, there may be critical outcomes for women entrepreneurs who are being caused from men having overweighed in decision-making roles. Outcomes include biases against women by VCs that prevent their ventures from being considered for funding from the pitch as well as obtaining opportunities to pitch VCs in consideration for funding from biases in the evaluations of the businesses themselves.

This paper is a consolidation of several studies the author has conducted in VC decision-making and gender bias to understand the drivers of the enormous gender gap in VC funding. The author presented it as a talk at the University of Regina and was asked to submit a paper about it here.

The findings reveal how the 93 per cent male context of the VC industry is in itself a significant cause of the gender gap in funding. If there were more women VCs, more women entrepreneurs would be funded.

The author showcases how the gender gap in decision-making roles in VC has important implications for women entrepreneurs to obtain funding.

The purpose of this paper is to explore why, despite the development of a hybrid investing logic, funding problems are so persistent for early-stage Cleantech ventures (“Cleantechs”). An institutional logics lens is adopted to analyze how key actors' perceptions and communications of the Cleantech value proposition shape information asymmetries (IAs).

A mixed methods approach draws on 82 Cleantech pitch decks and 31 investment guidance documents, and insights from interviews with 42 key informants and nine Cleantech CEOs and their investors.

IAs persist, first of all, because key investor and entrepreneurial actors combine different goals in the hybrid Cleantech value proposition. Interestingly, the analysis of Environmental Performance Indicators (EPIs) as a critical communication tool reveals a further mismatch in how actors actually combine logics. The authors ultimately identify three emergent actor roles – traditional laggard, developer and boundary spanner – that present a framework of how the three most influential actor groups develop EPIs and via that a hybrid Cleantech financing logic to overcome IAs.

The paper enhances the entrepreneurial finance literature primarily by showing that in contexts of hybrid investing a more nuanced understanding of institutional logics in terms of ends and means is critical to overcome IAs. While prior works highlight goal incompatibilities, the findings here suggest that the (in-)compatibility of goals as well as EPI choices of the same actors is likely to be the key explanandum for the stickiness of IAs and the funding gap. The novel emerging role framework offers additional theoretical, policy and practical advances for hybrid logic development.

The purpose of this paper is to examine the effects of funding liquidity risk and liquidity risk on the bank risk-taking.

This study employs a system generalized method of moments (GMM) estimation technique and a sample of 57 banks operating in BRICS countries over the period from 2006 to 2015.

The results reveal that liquidity risk has a significant and negative effect on the bank risk-taking, indicating that a decrease in liquidity risk contributes to higher bank risk-taking. The study also reveals that funding liquidity risk has the substantial impact on bank risk-taking, suggesting lower funding liquidity risk results in higher bank risk-taking. These results are consistent with prior assumptions.

The implications of this study highlight the fact that liquidity risk is a risk factor which drives the potential bank default, of which banks tend to take more risks when higher funding liquidity exists.

This study offers a number of valuable implications for the policy makers as well as practitioners. The policy makers should take into account better liquidity risk management framework aimed at preventing banks from taking excessive risks. Bank executives must pay more attention on how banks could hold more liquid securities and cash. Less risk-taking reduces higher borrowing costs undermining earnings through imposing taxes on corporate.

This work uncovered that liquidity risk per se is an important and previously unidentified risk factor, specifically its effects on bank risk-taking and contributes to the view in support of holding more liquid securities than the past.

This chapter presents research to assess the impact of the recent financial crisis on technology-based small firms (TBSFs) in the United Kingdom based on findings from an extended telephone survey with the owner-managers of 49 young and 51 more mature TBSFs, undertaken in 2010. Even before the onset of the global financial crisis in 2007, it was generally acknowledged that TBSFs faced greater obstacles in accessing finance than conventional SMEs. This is because banks have difficulty assessing the viability of new technology-based business ventures due to information asymmetries, whilst risk capital providers may have difficulty providing appropriate or sufficient funds on terms acceptable to entrepreneurs. Given the recent difficulties that SMEs, in general, have faced in obtaining external finance, we would expect TBSFs to have been particularly adversely affected by the financial crisis. Our evidence showed that TBSFs exhibited a strong demand for external finance between 2007 and 2010, related to their growth ambitions and achievements. They sought finance mainly from banks but also with younger TBSFs seeking business angel finance and more mature TBSFs seeking venture capital finance. However, our evidence indicates that both debt and equity finance became harder to access for TBSFs, particularly for early-stage and more R&D-intensive firms. Where funding was offered, it was often on unacceptable terms with regards to the levels of collateral or equity required. The chapter provides evidence of a growing funding gap and concludes that the ability of TBSFs to contribute to economic recovery is hampered by ongoing problems in obtaining external finance.

This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end of year financial reports for thirty midsized US cities. The analysis focuses on whether and how quickly and how extensively revenue and spending directions from past years are altered by recessions. A seven year series of Comprehensive Annual Financial Report (CAFR) data serves to explore whether citiesʼ revenues and spending, especially the traditional property tax and core functions such as public safety and infrastructure withstood the brief 2001 and the persistent 2007 recessions? The findings point to consumption (spending) over stability (revenue minus expense) for the recession of 2007, particularly in 2008 and 2009.

This chapter explores two policies guiding the education and funding related to students with and without disabilities in the United States. The Individuals with Disabilities Education Act (IDEA) of 2004 serves as the nation's primary legislation outlining policies, procedures and funding for the education of students with disabilities. Thus, IDEA 2004 is integral in understanding inclusion throughout the United States. The Every Student Succeeds Act (ESSA) of 2015 is regarded as the primary educational legislation concerned with funding to provide all students with access to a well-rounded education. The chapter begins with a brief overview of the laws in relation to inclusion and funding for teacher professional development (PD) and argues in support of funding specifically aimed at the PD of highly effective classroom teachers. Preparing, recruiting and retaining high quality teacher candidates must be a top priority in PK-12 education. In the current political climate, there is a need to examine how to use available resources in a time of shrinking budgets, teacher shortages and increasing equity gaps.

This chapter will examine budgets from the most recent five years available and make connections to issues related to funding for inclusive programming, including professional development of teachers. While ESSA does not guide PD of teachers, it guides the funding for said programmes. Through budget evaluations and analysis of the President's rationale for decreasing funding under Title II of ESSA, we demonstrate that the current President is decreasing funds for PD, recruitment, preparation and more on the basis that Title I funding of ESSA covers these activities. With a new election set to take place next year, this chapter explores how the budgets have impacted funding for inclusive programming while looking to the future and its impact on the preparation and development of teachers.

This paper seeks to understand the dynamics of new venture financing across 20 business start‐ups.

A total of 20 cases were explored, via initial discussions with the founder(s), and follow‐up contact to confirm sources of financing acquired during new venture creation. This approach was adopted because of the challenges associated with acquiring full details of start‐up financing, and in particular informal forms of new venture financing.

Significant variation in, and scale of, new venture financing was identified. In multiple cases, funding patterns did not tally with established explanations of small business financing.

The primary limitation of the analysis is the focus on a small number of individual cases. Although this allowed for more detailed analysis, it does not make the findings applicable across the small business population as a whole. New ventures acquired very different forms of finance, and in different configurations or “bundles”, so creating a wide range of start‐up financing patterns and overall levels of capitalisation. This suggests that multiple factors influence founder decisions on start‐up funding acquisition. It also indicates the wide divergence between highly capitalised and under‐capitalised start‐ups.

Many of the new ventures were started with low levels of capitalisation, which as the literature suggests is a strong determinant of reduced prospects for survival. This suggests a possible “financing deficit”, rather than gap, for a proportion of business start‐ups.

The paper provides an alternative methodology for considering new venture financing, and as a result concludes that standard, rational theories of small business financing may not always hold for new ventures.

This exploratory study aims to investigate the financing issues faced by Indian small and medium enterprise (SME) owners. It also classifies the financing constraints into four financing gaps, namely, demand, knowledge, supply and benevolence.

The study uses the convergent interviewing technique to highlight the key issues being faced by SME owners in financing. Forty-four owners from different industries and having dispersed demographics have been interviewed in the study.

The findings reveal the real-time issues being faced by SME owners. SMEs faced both demand- and supply-side constraints. The most common financing challenges are high cost of credit, complex procedures of lending institutions, information asymmetry, creditworthiness and self-abstaining from external financial resources. Issues pertaining to lack of knowledge and awareness about the financial products and services are also being noticed by the researchers.

This study identifies the major financing concerns of SMEs and thereby provides a directional approach to the policymakers in the area of SME financing.

The study offers a better and data-based understanding of financing issues being faced by the SME owners. The usage of convergent interviewing allows the researchers to highlight the common issues raised by the SME owners.

Developing countries are increasingly looking to private sector investment for infrastructure development. Successful development of private infrastructure projects, however, depends on adequate availability of long-term debt to complement private sector equity. As domestic bond markets in many emerging countries are not very deep, availability of long-term debt funding for infrastructure has been limited. Recently, a new form of financial intermediation has emerged in India with the creation of infrastructure debt funds (IDFs) to create capital pools for long-term debt funding. This paper aims to analyse the effectiveness of IDFs for financing infrastructure projects.

This paper uses a case study approach. The case studies were written using both secondary and primary information. Secondary information was obtained from various sources such as policy papers, websites and other published sources. Primary information was obtained from interviews with the top management of three IDFs. Information obtained from multiple sources was triangulated for consistency and correctness.

IDFs have emerged as an effective intermediation mechanism for attracting long-term capital by offering a new investment product with appropriate risk-adjusted returns. For the fund seekers, IDFs are able to provide long-term capital at lower rates and higher flexibility. Unlike commercial banks, IDFs are able to add value to the projects apart from funding by periodic monitoring of the projects.

Creating new forms of financial intermediation can help in reducing the financing gap for infrastructure projects, especially in emerging countries.

IDFs have been analysed from a perspective of financial intermediation. The effectiveness of IDFs in bridging the funding shortfall has been evaluated from multiple perspectives.