Finance pathways for young innovative small- and medium-size enterprises: A demand-side examination of finance gaps and policy implications for the post-global financial crisis finance escalator

摘要

The paper addresses the persistent finance gaps facing young, innovative SMEs, by examining the financing pathways of 40 UK businesses in a post global financial crisis (GFC) environment. Using a unique combination of finance escalator and resource-based view theories four propositions are tested by examining: (ⅰ) early and growth stage development; (ⅱ) innovation R&D investment horizons; (ⅲ) the management resource base; (ⅳ) finance gaps and their implications. The paper finds that successful financing strategies are emerging, using a mix of bootstrapping, collaboration and new emerging post-GFC finance escalator funding, which is heavily reliant on government interventions. It also pinpoints remaining finance gaps and the need for more cohesive financing and support policy to address these.