Rational actors, knowledgeable agents: Extending pecking order consideration of new venture financing to incorporate founder experience, knowledge and networks

Andrew Atherton (Lead / Corresponding author)

    Research output: Contribution to journalArticle

    25 Citations (Scopus)

    Abstract

    Standard explanations of the decisions made by new firm founders when acquiring financing to start ventures tend to refer to the efficiency and economic rationales underpinning such choices. In this article, pecking order approach is applied to 26 cases of new venture creation to test such 'rational actor' approaches.When pecking order considerations are extended to incorporate previous experiences of acquiring finance and perceptions of the ease and feasibility of doing so, a fuller explanation of decisions and patterns in new venture financing emerges.A key implication of this analysis is the need to consider the experiential and knowledge base of founders when seeking to understand the dynamics and drivers of new business funding.

    Original languageEnglish
    Pages (from-to)470-495
    Number of pages26
    JournalInternational Small Business Journal
    Volume27
    Issue number4
    Early online date31 Jul 2009
    DOIs
    Publication statusPublished - Aug 2009

    Keywords

    • Entrepreneurship
    • Founder experience
    • New venture
    • SME
    • Start-up finance

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