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Media type:
E-Article
Title:
Impacts of startup founders' personal and business networks on fundraising success by mediating fundraising opportunities
:
moderating role of firm age
Description:
This study examines the effects of personal and business networks on fundraising successes through fundraising opportunities and analyze the differences in the effects of personal and business networks vary depending on the firm’s age groups. The first finding of this study is that both the startup founder's personal and business networks increase the funding opportunities for startups. Second, the number of successful investments increases as the number of fundraising opportunities from business networks increases. Third, the total effect of business networks is greater than the total effect of personal networks. Fourth, the difference in the effect of a founder's business and personal network on investment success in an old or mature startup firm is greater than the difference in effect in a new and nascent startup firm. This result means that young start-ups that do not yet have sufficiently developed business networks rely on private networks to attract investment, and that the two types of networks have similar effects on investment attraction success in the early stages of the startup business. This study contributes to the literature by showing that the effectiveness of fundraising through business networks is greater than those of personal networks and the impacts of social networks on fundraising successes vary depending on the age or growth stage of startups.