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Equity financing and entrepreneurial growth: unveiling perspectives from the growth and expansion stage

Year 2025, Volume: 5 Issue: 1, 38 - 56, 03.05.2025

Mohammed Abdullah Alashiq Tamer Işın , Mustafa Kemal Topcu

https://doi.org/10.59597/akademikaci.1673925

Abstract

This study explores how equity financing supports entrepreneurial ventures' development and expansion stages. By reviewing the existing literature, this study looks into how equity finance influences business development as companies progress through different stages of entrepreneurship. The findings reveal equity financing as an important catalyst, offering both crucial capital and strategic support to scale operations effectively. Although many studies support a strong relationship between equity finance and business growth, issues such as ownership dilution and potential stakeholder conflicts are highlighted. By integrating key findings from previous research, this study strengthens the understanding of how equity financing affects entrepreneurial success. The conclusion offers valuable implications for entrepreneurs, investors, and policymakers, underlining the need for strategic financial planning to sustain long-term growth and innovation across the entrepreneurial ecosystem.

Keywords

Equity Financing Entrepreneurship Entrepreneurship Life Cycle Growth Finance

References

  • Aly, M., Audretsch, D., & Grimm, H. (2021). Emotional skills for entrepreneurial success: The promise of entrepreneurship education and policy. The Journal of Technology Transfer, 46. https://doi.org/10.1007/s10961-021-09866-1.
  • Audretsch, D. B. (2004). The Knowledge Spillover Theory of Entrepreneurship. Review of Entrepreneurship, 6(1), 7-23.
  • Beck, T., Demirgüç-Kunt, A., & Levine, R. (2007). Finance, inequality and the poor. Journal of Economic Growth, 12(1), 27-49.
  • Beck, T., Demirgüç-Kunt, A., Laeven, L., & Maksimovic, V. (2014). The determinants of financing obstacles. Journal of International Money and Finance, 37, 1-22.
  • Belleflamme, P., Lambert, T., & Schwienbacher, A. (2014). Crowdfunding: Tapping the right crowd. Journal of Business Venturing, 29(5), 585-609. https://doi.org/10.1016/j.jbusvent.2013.07.003
  • Berger, A. N., & Udell, G. F. (1998). The economics of small business finance: The roles of private equity and debt markets in the financial growth cycle. Journal of Banking & Finance, 22(6-8), 613-673. https://doi.org/10.1016/S0378-4266(98)00038-7
  • Brush, C. G., Carter, N. M., Gatewood, E. J., Greene, P. G., & Hart, M. M. (2009). The Diana Project: Women business owners and equity capital: The myths dispelled. Journal of International Business Studies, 40(5), 887-907.
  • Brush, C. G., Greene, P. G., & Hart, M. M. (2001). From initial idea to unique advantage: The entrepreneurial challenge of constructing a resource base. Academy of Management Executive, 15(1), 64-78. https://doi.org/10.5465/ame.2001.4251394
  • Cassar, G. (2004). The financing of business start-ups. Journal of Business Venturing, 19(2), 261-283. https://doi.org/10.1016/S0883-9026(03)00029-6
  • Cumming, D., & Johan, S. (2008). Pre-seed government venture capital funds. Journal of International Entrepreneurship, 6(2), 144-178. https://doi.org/10.1007/s10843-008-0020-8
  • Cumming, D., & Johan, S. A. (2009). Venture capital and private equity contracting: An international perspective. Academic Press.
  • Davidsson, P., & Wiklund, J. (2006). Levels of analysis in entrepreneurship research: Current research practice and suggestions for the future. Entrepreneurship Theory and Practice, 30(1), 81-99.
  • DeAngelo, H., DeAngelo, L., & Stulz, R. M. (2006). Dividend policy and the earned/contributed capital mix: A test of the lifecycle theory. Journal of Financial Economics, 81(2), 227-254. https://doi.org/10.1016/j.jfineco.2005.07.005
  • Díaz-García, M. C., & Jiménez-Moreno, J. (2010). Entrepreneurial intention: The role of gender. International Entrepreneurship and Management Journal, 6(3), 261-283.
  • Dyer, J. H., Kale, P., & Singh, H. (2001). How to make strategic alliances work. MIT Sloan Management Review, 42(4), 37-43.
  • Erbakan, N. (1993), Adil Düzen, Milsan Basım Sanayi A.Ş, Ankara.
  • Gartner, W. B. (1988). "Who is an entrepreneur?" is the wrong question. American Journal of Small Business, 12(4), 11-32.
  • Gaughan, P. A. (2010). Mergers, Acquisitions, and Corporate Restructurings. John Wiley & Sons.
  • Gitman, L. J., Juchau, R., & Flanagan, J. (2014). Principles of Managerial Finance. Pearson Australia.
  • Gompers, P. A., & Lerner, J. (2001). The venture capital cycle. MIT Press.
  • Gompers, P., & Lerner, J. (2001). The Money of Invention: How Venture Capital Creates New Wealth. Harvard Business School Press.
  • Harrison, R. T., & Mason, C. M. (2007). Does gender matter? Women business angels and the supply of entrepreneurial finance. Entrepreneurship Theory and Practice, 31(3), 445-472.
  • Hellmann, T., & Puri, M. (2002). Venture capital and the professionalization of start-up firms: Empirical evidence. Journal of Finance, 57(1), 169-197. https://doi.org/10.1111/1540-6261.00419
  • Hsu, D. H. (2004). What do entrepreneurs pay for venture capital affiliation? Journal of Finance, 59(4), 1805-1844. https://doi.org/10.1111/j.1540-6261.2004.00680.x
  • Işın, T., Işın, Z. C., Fidan, H., & Işın, B. T. (2023). Yeni Nesil Girişimcilik: Devlet Destekleri ve Türkiye Örneği. In T. Işın & M. K. Topcu (Eds.), Yeni Nesil Girişimcilik Ekosistemi (pp. 153-190). Siyasal Kitabevi.
  • Işın, T., Işın, Z. C., Fidan, H., & Işın, B. T. (2023). Yeni Nesil Girişimcilik: Girişimcilik 5.0 ve Ahiyan Felsefesi. In T. Işın & M. K. Topcu, Yeni Nesil Girişimcilik Ekosistemi (pp. 35-92). Siyasal Kitabevi.
  • Işın, T., Işın, Z. C., Fidan, H., Işın, B. T., & Işın, E. (2024). Girişimcilik eğitimi ve yeni bir yaklaşım: Girişim mühendisliği. III. Uluslararası Katılımlı Ankara İnsan ve Toplum Bilimleri Kongresi Bildiriler Kitabı.
  • Işın, T., Topcu, M. K., & Çömlek, O. (2024). Tıbbi İnovasyon Girişimciliğinde Alternatif Finansman Modeli Olarak İş Melekleri. Akademik Açı, 4(1), 77-124. https://doi.org/10.59597/akademikaci.1470653
  • Işın, T., Işın, Z. C., Topcu, M. K., Fidan, H., & Işın, B. T. (2024). Ulusal İnovasyon Güvenliği: Güvenliğin İnovasyonu mu? İnovasyonun Güvenliği mi? In Uluslararası Güvenlik Sempozyumu: 1923’ten 2023’e Türkiye Yüzyılında Güvenlik Perspektifi Bildiri Sunumu. https://www.jsga.edu.tr/uluslararasi-guvenlik-sempozyumu-1923ten-2023e-turkiye-yuzyilinda-guvenlik-perspektifi
  • Jones, T. P., & Tilley, F. (2003). Making sense of angel investing: A study of business angels' investment practices. International Small Business Journal, 21(3), 273-290.
  • Kaplan, S. N., & Strömberg, P. (2009). Leveraged buyouts and private equity. Journal of Economic Perspectives, 23(1), 121-146. https://doi.org/10.1257/jep.23.1.121
  • Liang, C. A., & Dunn, P. (2020). Follow the money: Financing pathways and financial bootstrapping strategies of high-growth ventures. Journal of Business Venturing, 35(2), 105920.
  • Marx, Karl (2003), Kapital I, Çev: Alaattin Bilgi, Eriş Yayınları, III. Basım.
  • Mason, C., & Stark, M. (2004). What do investors look for in a business plan? A comparison of the investment criteria of bankers, venture capitalists and business angels. International Small Business Journal, 22(3), 227-248.
  • Robb, A. M., & Robinson, D. T. (2014). The capital structure decisions of new firms. Review of Financial Studies, 27(1), 153-179. https://doi.org/10.1093/rfs/hhs072
  • Sahlman, W. A. (1990). The structure and governance of venture-capital organizations. Journal of Financial Economics, 27(2), 473-521. https://doi.org/10.1016/0304-405X(90)90065-8
  • Sahlman, W. A. (1997). How to write a great business plan. Harvard Business Review. Retrieved from https://hbr.org/1997/07/how-to-write-a-great-business-plan
  • Sapienza, H. J., & Gupta, A. K. (1994). Impact of agency risks and task uncertainty on venture capitalist-CEO interaction. Academy of Management Journal, 37(6), 1618-1632. https://doi.org/10.5465/256801
  • Sapienza, H. J., Manigart, S., & Vermeir, W. (1996). Venture capitalist governance and value added in four countries. Journal of Business Venturing, 11(6), 439-469. https://doi.org/10.1016/S0883-9026(96)00052-3
  • Sarasvathy, S. (2001). Causation and effectuation: Toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review, 26(2), 243-263.
  • Schwienbacher, A. (2008). Innovation and venture capital exits. Economic Journal, 118(533), 1888-1916. https://doi.org/10.1111/j.1468-0297.2008.02197.x
  • Sohl, J. E. (2003). The private equity market in the USA: Lessons from volatility. Venture Capital: An International Journal of Entrepreneurial Finance, 5(1), 29-46. https://doi.org/10.1080/1369106032000064790
  • Stevenson, H. H. (1983). A perspective on entrepreneurship. Harvard Business Review, 61(3), 37-41.
  • Timmons, J. A., & Bygrave, W. D. (1986). Venture capital's role in financing innovation for economic growth. Journal of Business Venturing, 1(2), 161-176. https://doi.org/10.1016/0883-9026(86)90012-1
  • Wright, M., Hoskisson, R. E., & Busenitz, L. W. (2001). Firm rebirth: Buyouts as facilitators of strategic growth and entrepreneurship. Academy of Management Perspectives, 15(1), 111-125. https://doi.org/10.5465/ame.2001.4251560

Özsermaye Finansmanı ve Girişim Büyümesi: Büyüme ve Genişleme Aşamasından Perspektifler

Year 2025, Volume: 5 Issue: 1, 38 - 56, 03.05.2025

Mohammed Abdullah Alashiq Tamer Işın , Mustafa Kemal Topcu

https://doi.org/10.59597/akademikaci.1673925

Abstract

Bu çalışma, özkaynakla finansmanın girişimcilik girişimlerinin gelişim ve genişleme aşamalarını nasıl desteklediğini incelemektedir. Mevcut literatürün taranması yoluyla, şirketlerin girişimcilik yaşam döngüsündeki çeşitli aşamalardan geçerken, özkaynak finansmanının işletme gelişimini nasıl etkilediği ele alınmaktadır. Bulgular, özkaynak finansmanının yalnızca hayati sermaye sağlamasıyla değil, aynı zamanda operasyonların etkin şekilde ölçeklenmesine olanak tanıyan stratejik destek sunmasıyla da önemli bir katalizör işlevi gördüğünü ortaya koymaktadır. Pek çok çalışma, özkaynak finansmanı ile işletme büyümesi arasında güçlü bir ilişki bulunduğunu desteklese de, mülkiyetin seyrelmesi ve paydaşlar arası olası çıkar çatışmaları gibi sorunlar da vurgulanmaktadır. Bu çalışma, önceki araştırmalardan elde edilen temel bulguları bütünleştirerek, özkaynakla finansmanın girişimcilik başarısına olan etkisine dair anlayışı derinleştirmektedir. Sonuç bölümünde, girişimciler, yatırımcılar ve politika yapıcılar için değerli çıkarımlar sunularak, girişimcilik ekosisteminde uzun vadeli büyüme ve yeniliğin sürdürülebilirliği için stratejik finansal planlamanın gerekliliği vurgulanmaktadır.

Keywords

Özsermayenin Finansmanı girişimcilik girişim yaşam döngüsü büyüme finansman

References

  • Aly, M., Audretsch, D., & Grimm, H. (2021). Emotional skills for entrepreneurial success: The promise of entrepreneurship education and policy. The Journal of Technology Transfer, 46. https://doi.org/10.1007/s10961-021-09866-1.
  • Audretsch, D. B. (2004). The Knowledge Spillover Theory of Entrepreneurship. Review of Entrepreneurship, 6(1), 7-23.
  • Beck, T., Demirgüç-Kunt, A., & Levine, R. (2007). Finance, inequality and the poor. Journal of Economic Growth, 12(1), 27-49.
  • Beck, T., Demirgüç-Kunt, A., Laeven, L., & Maksimovic, V. (2014). The determinants of financing obstacles. Journal of International Money and Finance, 37, 1-22.
  • Belleflamme, P., Lambert, T., & Schwienbacher, A. (2014). Crowdfunding: Tapping the right crowd. Journal of Business Venturing, 29(5), 585-609. https://doi.org/10.1016/j.jbusvent.2013.07.003
  • Berger, A. N., & Udell, G. F. (1998). The economics of small business finance: The roles of private equity and debt markets in the financial growth cycle. Journal of Banking & Finance, 22(6-8), 613-673. https://doi.org/10.1016/S0378-4266(98)00038-7
  • Brush, C. G., Carter, N. M., Gatewood, E. J., Greene, P. G., & Hart, M. M. (2009). The Diana Project: Women business owners and equity capital: The myths dispelled. Journal of International Business Studies, 40(5), 887-907.
  • Brush, C. G., Greene, P. G., & Hart, M. M. (2001). From initial idea to unique advantage: The entrepreneurial challenge of constructing a resource base. Academy of Management Executive, 15(1), 64-78. https://doi.org/10.5465/ame.2001.4251394
  • Cassar, G. (2004). The financing of business start-ups. Journal of Business Venturing, 19(2), 261-283. https://doi.org/10.1016/S0883-9026(03)00029-6
  • Cumming, D., & Johan, S. (2008). Pre-seed government venture capital funds. Journal of International Entrepreneurship, 6(2), 144-178. https://doi.org/10.1007/s10843-008-0020-8
  • Cumming, D., & Johan, S. A. (2009). Venture capital and private equity contracting: An international perspective. Academic Press.
  • Davidsson, P., & Wiklund, J. (2006). Levels of analysis in entrepreneurship research: Current research practice and suggestions for the future. Entrepreneurship Theory and Practice, 30(1), 81-99.
  • DeAngelo, H., DeAngelo, L., & Stulz, R. M. (2006). Dividend policy and the earned/contributed capital mix: A test of the lifecycle theory. Journal of Financial Economics, 81(2), 227-254. https://doi.org/10.1016/j.jfineco.2005.07.005
  • Díaz-García, M. C., & Jiménez-Moreno, J. (2010). Entrepreneurial intention: The role of gender. International Entrepreneurship and Management Journal, 6(3), 261-283.
  • Dyer, J. H., Kale, P., & Singh, H. (2001). How to make strategic alliances work. MIT Sloan Management Review, 42(4), 37-43.
  • Erbakan, N. (1993), Adil Düzen, Milsan Basım Sanayi A.Ş, Ankara.
  • Gartner, W. B. (1988). "Who is an entrepreneur?" is the wrong question. American Journal of Small Business, 12(4), 11-32.
  • Gaughan, P. A. (2010). Mergers, Acquisitions, and Corporate Restructurings. John Wiley & Sons.
  • Gitman, L. J., Juchau, R., & Flanagan, J. (2014). Principles of Managerial Finance. Pearson Australia.
  • Gompers, P. A., & Lerner, J. (2001). The venture capital cycle. MIT Press.
  • Gompers, P., & Lerner, J. (2001). The Money of Invention: How Venture Capital Creates New Wealth. Harvard Business School Press.
  • Harrison, R. T., & Mason, C. M. (2007). Does gender matter? Women business angels and the supply of entrepreneurial finance. Entrepreneurship Theory and Practice, 31(3), 445-472.
  • Hellmann, T., & Puri, M. (2002). Venture capital and the professionalization of start-up firms: Empirical evidence. Journal of Finance, 57(1), 169-197. https://doi.org/10.1111/1540-6261.00419
  • Hsu, D. H. (2004). What do entrepreneurs pay for venture capital affiliation? Journal of Finance, 59(4), 1805-1844. https://doi.org/10.1111/j.1540-6261.2004.00680.x
  • Işın, T., Işın, Z. C., Fidan, H., & Işın, B. T. (2023). Yeni Nesil Girişimcilik: Devlet Destekleri ve Türkiye Örneği. In T. Işın & M. K. Topcu (Eds.), Yeni Nesil Girişimcilik Ekosistemi (pp. 153-190). Siyasal Kitabevi.
  • Işın, T., Işın, Z. C., Fidan, H., & Işın, B. T. (2023). Yeni Nesil Girişimcilik: Girişimcilik 5.0 ve Ahiyan Felsefesi. In T. Işın & M. K. Topcu, Yeni Nesil Girişimcilik Ekosistemi (pp. 35-92). Siyasal Kitabevi.
  • Işın, T., Işın, Z. C., Fidan, H., Işın, B. T., & Işın, E. (2024). Girişimcilik eğitimi ve yeni bir yaklaşım: Girişim mühendisliği. III. Uluslararası Katılımlı Ankara İnsan ve Toplum Bilimleri Kongresi Bildiriler Kitabı.
  • Işın, T., Topcu, M. K., & Çömlek, O. (2024). Tıbbi İnovasyon Girişimciliğinde Alternatif Finansman Modeli Olarak İş Melekleri. Akademik Açı, 4(1), 77-124. https://doi.org/10.59597/akademikaci.1470653
  • Işın, T., Işın, Z. C., Topcu, M. K., Fidan, H., & Işın, B. T. (2024). Ulusal İnovasyon Güvenliği: Güvenliğin İnovasyonu mu? İnovasyonun Güvenliği mi? In Uluslararası Güvenlik Sempozyumu: 1923’ten 2023’e Türkiye Yüzyılında Güvenlik Perspektifi Bildiri Sunumu. https://www.jsga.edu.tr/uluslararasi-guvenlik-sempozyumu-1923ten-2023e-turkiye-yuzyilinda-guvenlik-perspektifi
  • Jones, T. P., & Tilley, F. (2003). Making sense of angel investing: A study of business angels' investment practices. International Small Business Journal, 21(3), 273-290.
  • Kaplan, S. N., & Strömberg, P. (2009). Leveraged buyouts and private equity. Journal of Economic Perspectives, 23(1), 121-146. https://doi.org/10.1257/jep.23.1.121
  • Liang, C. A., & Dunn, P. (2020). Follow the money: Financing pathways and financial bootstrapping strategies of high-growth ventures. Journal of Business Venturing, 35(2), 105920.
  • Marx, Karl (2003), Kapital I, Çev: Alaattin Bilgi, Eriş Yayınları, III. Basım.
  • Mason, C., & Stark, M. (2004). What do investors look for in a business plan? A comparison of the investment criteria of bankers, venture capitalists and business angels. International Small Business Journal, 22(3), 227-248.
  • Robb, A. M., & Robinson, D. T. (2014). The capital structure decisions of new firms. Review of Financial Studies, 27(1), 153-179. https://doi.org/10.1093/rfs/hhs072
  • Sahlman, W. A. (1990). The structure and governance of venture-capital organizations. Journal of Financial Economics, 27(2), 473-521. https://doi.org/10.1016/0304-405X(90)90065-8
  • Sahlman, W. A. (1997). How to write a great business plan. Harvard Business Review. Retrieved from https://hbr.org/1997/07/how-to-write-a-great-business-plan
  • Sapienza, H. J., & Gupta, A. K. (1994). Impact of agency risks and task uncertainty on venture capitalist-CEO interaction. Academy of Management Journal, 37(6), 1618-1632. https://doi.org/10.5465/256801
  • Sapienza, H. J., Manigart, S., & Vermeir, W. (1996). Venture capitalist governance and value added in four countries. Journal of Business Venturing, 11(6), 439-469. https://doi.org/10.1016/S0883-9026(96)00052-3
  • Sarasvathy, S. (2001). Causation and effectuation: Toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review, 26(2), 243-263.
  • Schwienbacher, A. (2008). Innovation and venture capital exits. Economic Journal, 118(533), 1888-1916. https://doi.org/10.1111/j.1468-0297.2008.02197.x
  • Sohl, J. E. (2003). The private equity market in the USA: Lessons from volatility. Venture Capital: An International Journal of Entrepreneurial Finance, 5(1), 29-46. https://doi.org/10.1080/1369106032000064790
  • Stevenson, H. H. (1983). A perspective on entrepreneurship. Harvard Business Review, 61(3), 37-41.
  • Timmons, J. A., & Bygrave, W. D. (1986). Venture capital's role in financing innovation for economic growth. Journal of Business Venturing, 1(2), 161-176. https://doi.org/10.1016/0883-9026(86)90012-1
  • Wright, M., Hoskisson, R. E., & Busenitz, L. W. (2001). Firm rebirth: Buyouts as facilitators of strategic growth and entrepreneurship. Academy of Management Perspectives, 15(1), 111-125. https://doi.org/10.5465/ame.2001.4251560
There are 45 citations in total.

Details

Primary Language English
Subjects Entrepreneurship
Journal Section Research Articles
Authors

Mohammed Abdullah Alashiq 0009-0006-5124-4760

Tamer Işın 0000-0002-3295-6651

Mustafa Kemal Topcu 0000-0002-3298-1283

Publication Date May 3, 2025
Submission Date April 11, 2025
Acceptance Date May 2, 2025
Published in Issue Year 2025 Volume: 5 Issue: 1

Cite

APA Alashiq, M. A., Işın, T., & Topcu, M. K. (2025). Equity financing and entrepreneurial growth: unveiling perspectives from the growth and expansion stage. Akademik Açı, 5(1), 38-56. https://doi.org/10.59597/akademikaci.1673925
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