The role of government venture capital funds: recent lessons from the U.K. experience

UK Government Venture Capital (GVC) - backed schemes have evolved to provide more effective, targeted, funding for high growth potential firms. Public-private co-financing, is generating attributable, additional, positive employment and sales turnover impacts in beneficiary firms, but significant long horizon follow-on investment requirements need addressing. Policy designers should be cognisant of the changing external financing ecosystem when designing co-investment schemes

The evolution of entrepreneurial finance – 10 years after the global financial crisis [Editorial]

In the period following the global financial crisis, as banks and private equity investors withdrew from early stage entrepreneurial finance markets in the United Kingdom and developed economies (Mac an Bhaird, 2014; Wilson and Silver, 2013), there was a profusion in supply of alternative sources of early stage entrepreneurial finance (World Bank, 2013). These new financing options for firms partly alleviated the adverse effects of pro-cyclical provision of entrepreneurial finance (Mac an Bhaird et al., 2019). The large increase in provision of nontraditional sources of finance for the real economy was viewed as revolutionary (Harrison, 2013) and potentially transformative (Bruton et al., 2015), and its sustained use over more than a decade suggests that it is more than a passing fad. The amount of finance procured from these sources has grown significantly in a very short time period and is estimated to surpass investment from traditional sources of funding in the near future (Barnett, 2015). These developments have significant implications in relation to the supply of, and demand for, entrepreneurial finance, including well-established issues which primarily stem from information asymmetries, such as agency, signalling, moral hazard and adverse selection. The emergence of new sources of alternative finance introduces additional concerns in relation to regulation, investor protection, ownership and governance, among other issues (Bruton et al., 2015). The significant increase in the supply and use of alternative sources of finance has been facilitated to a large extent by the expansion of the Internet and use of social media. The increase in supply of, and demand for, alternative sources of finance has been accompanied by a burgeoning literature on the subject, due primarily to the availability of data that are accessible from the online platforms and websites. Over a decade has passed since the increased provision and use of alternative finance in its various forms and amounts, providing us with an opportunity to assess and analyse its adoption and to appraise how its provision may be improved for the benefit of investors and borrowers. At this juncture, we should have adequate evidence to increase the efficiency of provision from alternative sources, in order to improve the supply of finance in private debt and equity markets and to provide greater diversification and depth in financial markets. The International Journal of Entrepreneurship and Innovation has been to the forefront in publishing innovative studies on topical issues at the nexus of entrepreneurship and innovation (e.g. Volume 19, Issue 1, ‘Green innovation – connecting governance, practices and outcomes’). This special issue continues in that tradition, publishing state-of-the-art studies on a variety of issues related to innovations in entrepreneurial finance. This special issue is significantly different from other journal special issues on this subject (e.g. Baldock and Mason, 2015; Harrison, 2015; Owen et al., 2019) in the range and breadth of issues investigated and analysed. The studies represent a broad geographic spread, including New Zealand, the United Kingdom, France, and the United States. A broad range of financing innovations are also considered, including blockchain, peer-to-peer (P2P) lending, equity-based crowdfunding and mobile payment systems. Each article provides a unique contribution to our knowledge of entrepreneurial finance, and a brief summary is provided in the following section. [...

Blockchain and other innovations in entrepreneurial finance: implications for future policy

More than a decade after the Global Financial Crisis (GFC) of 2007–08, entrepreneurial finance has exhibited enormous changes, notably in the rise of alternative nonbank financing. This has been most acutely experienced in the provision and delivery of early stage and innovative business finance—the focus of this special issue. The ensuing innovations in entrepreneurial finance have taken place in developed and developing economies, presenting considerable challenges to policymakers. This editorial paper reviews the special issue articles on this subject and their implications for future research, practice and policy

Appropriate settings and supports for third level diagnostic testing in mathematics

Mathematical diagnostic tests are issued to first year students by many third level institutions, including Dublin City University and the National University of Ireland Maynooth. The aim of such tests is to provide staff and students with an immediate picture of which mathematical concepts are well-known to the student. The tests are also a mechanism through which students who are struggling are made immediately aware of a wide range of follow-up initiatives, which are provided by the respective Mathematics Learning Support Centres. A common questionnaire was issued to students in both institutions to ascertain their attitudes towards diagnostic testing. In this paper, we present an overview of the role of the diagnostic test in both institutions, look at the mathematical backgrounds of the students tested, and present their views on the purpose of the test and the environment in which they took it. We also investigate their views on the subsequent feedback they received and the supports available to them. Finally, we look at the changes that both institutions have made as a result of this questionnaire

Small beer? Peer-to-peer lending in the craft beer sector

Peer to peer lending has advantages of ease of access to finance, timely and efficient delivery of funding, and is particularly beneficial at a specific time in the life cycle of the firm

Editorial entrepreneurial finance for green innovative SMEs

The Autumn 2022 COP27 Conference of the Parties of the United Nations Framework Convention on Climate Change demonstrated that the need for a clear research and policy agenda to assist the financing of early stage Cleantech and green SMEs innovation and green practice adoption has never been greater. Green, cleantech innovators hold important keys to unlocking vital globally game changing technologies that can scale-up to mitigate climate change and humanity’s wider environmental damage to ensure planetary sustainability. The paper provides a contemporary overview of the financing issues facing green SME innovators and adopters by reviewing seven papers published in this IEEE Transactions on Engineering Management Special Issue on green entrepreneurial finance. The papers provide deep insights into SMEs’ external financing requirements, barriers to private finance and the shortcomings of public tax and financing policies. This editorial paper concludes with a series of key recommendations for researchers, SME finance practitioners and public policymakers which provide guidance for more holistic policies to deliver longer horizon patient capital investing and facilitate green innovation commercialization, scale-up and adoption for a sustainable plane

Financing SME growth in the UK: meeting the challenges after the global financial crisis

In the aftermath of the Global Financial Crisis new forms of SME finance are emerging in the place of traditional banking and equity finance sources. This Special Issue has its origins in a conference organised in June 2014 by the Centre for Enterprise and Economic Development Research (CEEDR) at Middlesex University Business School, where all but the final two papers were presented. The Conference was designed to provide a timely forum for leading academics, practitioners and policy makers to disseminate current research and practitioner knowledge exploring finance gaps and how best to address the financing needs of small high growth potential businesses

An assessment of the business impacts of the UK's Enterprise Capital Funds

Recent European studies present persistently critical views of the under performance of government backed venture capital (GVC) schemes when compared to their private sector counterparts. However, they assess the performance of outmoded funding models and fail to contextualise the economic development role of these schemes. This paper provides a contemporary assessment of the business impacts of the UK government’s flagship Enterprise Capital Funds (ECFs) VC scheme in addressing the sub-£2m equity finance gap facing young potential high growth businesses requiring investments. Supply and demand-side evidence is presented from interviews with ECF fund managers, alternative private VCs, industry experts and surveys of successful and unsuccessful scheme applicants. We find that, despite the limitations of mid-scheme evaluation, ECFs are addressing the UK equity gap and delivering business employment, revenue and innovation impacts. However, further progress is required in order to achieve optimal business exits and sustainable early stage private VC system impacts