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Concern about the equity gap in the UK has existed for more than 60 years. Despite various government measures and institutional responses (e.g. the development of a venture capital industry) an equity gap still persists. Current debate has recognized the role of the informal venture capital market as a source of risk capital for SMEs. Argues that this market is both inefficient and underdeveloped, due largely to information deficiencies which hinder contact between potential investors and entrepreneurs seeking finance. Against this background, identifies the role of business angel networks (BANs) as a key means of stimulating the flow of informational venture capital in the UK. In particular, a government scheme to provide pump‐priming assistance to establish five local BAN demonstration projects is shown to have achieved impressive results. However, with the recent emergence of a number of private sector BANs, the continued role of government is now being questioned. Further demonstrates that public sector BANs, operating on a local scale, are filling a different market niche from that of private sector BANs, which operate predominantly on a national scale. Concludes that the top priority for policy is to ensure that all parts of the UK are served by local BANs. An appropriate way forward might be to build on experimental networking arrangements between local, public sector BANs and national, privately operated BANs.

Changes in the macroeconomy, combined with changes in bank lending practices, have created a more difficult financing environment for small businesses in the UK in the 1990s. Notes increasing encouragement for small businesses to seek venture capital as an alternative, but points out evidence both of a lack of venture capital for firms seeking less than £500,000 and a belief that small firms are unwilling to seek venture capital. Challenges these views and points out the advantages to the banks of an informal venture capital market. Considers ways for banks to encourage such activity.

The purpose of this paper is to examine how entrepreneurship culture affects start-up and venture capital co-evolution during the early evolution of an entrepreneurial ecosystem (EE) and its ability to foster the emergence of ambitious entrepreneurship as an outcome of its activity. Unlike studies that capture entrepreneurship culture at the national level, this study focusses specifically on the culture of venture capital-financed entrepreneurship and understanding its implications to the development of venture capital markets and successful firm-level outcomes within ecosystems.

Relying on EE and organisational imprinting theory, this study specifies characteristics of venture capital-financed entrepreneurship of Silicon Valley to illustrate the American way of building start-ups and examine whether they have as imprints affected to the entrepreneurship culture and start-up and venture capital co-evolution in Finland during the early evolution of its EE between 1980 and 1997.

The results illustrate venture capital-financed entrepreneurship culture as a specific example of entrepreneurship culture beneath the national level that can vary across geographies like the findings concerning Finland demonstrate. The findings show that this specific culture matters through having an impact on the structural evolution and performance of EEs and on the ways how they deliver or fail to deliver benefits to entrepreneurs.

The results show that venture capital-financed entrepreneurship and the emergence of success stories as outcomes of start-up and venture capital co-evolution within an EE are connected to a specific type of entrepreneurship culture. This paper also contributes to the literature by connecting the fundamentals of organisational imprinting to EE research.

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.

The purpose of this paper is to uncover the strategic nature of formal seed capital in Norway as opposed to equally sized venture capital firms.

As the population of Norwegian seed capital firms is embedded in this study, a differential approach is taken when contrasting these seed capital firms with venture capital firms of approximately the same size.

The findings indicate that seed capital firms take higher market risk than their counterparts, and that they diversify to a larger extent than comparable venture capital firms. The latter appears to be a function of the former.

This study reviews previous categorizations of seed capital providers, henceforth building towards an overall taxonomy of seed capital.

The purpose of this paper is to identify the key characteristics of the post‐investment relationship between the venture capital firm and its investee companies.

The research is a case study of a major UK venture capital firm using qualitative research to determine the key characteristics of the post‐investment relationship. The study is based on interviews with parties on both sides of the relationship.

While the results reflect the findings of the entrepreneurship and venture capital literature they also point to the importance of network growth and development for organizational learning in the venture capital industry, professionalization of investee firms and as a context in which the selection of the entrepreneur and the post investment relationship are set.

The research has the limitation of most case studies that the results cannot readily be generalized, in this case to the wider population of venture capital firms. Confidentiality issues also limited the extent to which a longitudinal study could be conducted.

A better understanding of the post‐investment relationship can inform entrepreneurs in their pitch for funds and in their anticipation of the post investment relationship. This understanding can also assist venture capital firms in the management of this relationship.

The case study uses data from rare access to a venture capital firm. It also differs by interviewing both parties to the post‐investment relationship, that is venture capitalist and investee firm.

The availability of external equity finance is a key factor in the development of technology‐based firms (TBFs). However, although a wide variety of sources are potentially available, many firms encounter difficulties in securing funding. The venture capital community, particularly in the UK, has done little to finance early stage TBFs and has failed to cater adequately for the specific value‐added requirements of these firms. Non‐financial companies have the potential to become an important alternative source of equity finance for TBFs through the process of corporate venture capital (CVC) investment. Based on a telephone survey of 48 UK TBFs that have raised CVC, examines the role of CVC in the context of TBF equity financing. Shows that CVC finance has represented a significant proportion of the total external equity raised by the survey firms and has been particularly important during the early stages of firm development. In addition, CVC often provides investee firms with value‐added benefits, primarily in the form of technical‐ and marketing‐related nurturing and credibility in the marketplace. Concludes with implications for TBFs, large companies, venture capital fund managers and policy makers.

The purpose of the paper is to analyze the development of business angel networks (BANs) in emerging countries such as Chile and Colombia to understand how institutions affect their development.

This is a qualitative, exploratory, and descriptive study based on a comparative analysis between countries, with the BANs in Chile and Colombia as the unit of observation. The comparative analysis was made in relation with the creation, operation and sustainability of the BANs. The study interviews the partners/managers of the active networks in each of the countries, as well as key informants, totalling 12 interviews.

BAN activity in Chile and Colombia is quite recent, and the countries are on a similar level of development. However, in the long term, depending on how the cultural aspects evolve in both countries and the interest that the State may have in developing business angel activity, the results could be indeed different.

Business angel activity in Latin America is quite recent; nevertheless, this activity is increasing in the region. In that sense, this comparative analysis between Colombia and Chile contributes to a better understanding of business angel markets in Latin America and also to obtain better insights into the core challenges that these markets face in emerging countries due to the existence of institutional voids. This paper is a contribution for further knowledge of BANs in emerging countries’ economies from an institutional perspective.

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.