Bridging The Gap Between Funders And Entrepreneurs Commerce Essay

A research undertaking submitted to the Gordon Institute of Business Science, University of Pretoria, in partial fulfillment of the demands for the grade of Master of Business Administration.


The abstract should look on the following page and should be limited to 200 words. The abstract should get down with a sentence that describes the major subject of the research.

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The intent and methodological analysis of the research and the result should so be briefly described.


Business angelsEntrepreneurFunderStart-upVenture Capitalist


I declare that this research undertaking is my ain work. It is submitted in partial fulfillment of the demands for the grade of Master of Business Administration at the Gordon Institute of Business Science, University of Pretoria.

It has non been submitted before for any grade or scrutiny in any other University. I further declare that I have obtained the necessary mandate and consent to transport out this research.Frans Sarel Jacobus Els7 November 2012


I would wish to show my grasp and gratitude to a figure of people who have made this research possible.I would wish to thank my supervisor Judi Sandrock, for her penetration, adept advice and counsel.The staff at the Gordon Institute of Business Science, peculiarly the library staff, for all their aid.

A large thank you goes to Yendra Booysen and Sharon new wave der Westhuizen for all their aid from start to complete.This research would non hold been possible without the responses and generous sum of clip that the interviewees afforded me. A particular thanks to Charl Cilliers and Koos van Ettinger for lending to my research and my MBA grade and leting me many hours of survey leave.Thankss to my co-workers at the office for maintaining things traveling while I was off for yearss.Last but non least I would wish to thank Mikhail Adriaanse for standing by my side, although we sometimes merely saw each other on Skype.


ABSTRACTaˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦ .

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ACKNOWLEDGEMENTSaˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦ …


Table OF CONTENTSaˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦ … aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦vi

List OF TABLESaˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦.viii

List OF FIGURESaˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦aˆ¦.viii



Chapter 1: Introduction TO RESEARCH PROBLEM

The job statement

The European Private Equity and Venture Capital Association ( EVCA ) ( 2007 ) claimed that private equity and venture capital is an progressively of import beginning of finance for possible companies as three quarters of the Europeans see a deficiency of fiscal support as the chief ground for it being hard to get down their ain concern.

In 2008, venture capital-backed houses accounted for 11 per centum of occupations and 21 per centum of GDP ( Dos Santos, Patel & A ; D’Souza, 2011 ) .ENTREPRENEURS – The South African private equity ( PE ) and venture capital ( VC ) industry has over R100 billion under direction. The supply of VC to the little and average endeavor ( SME ) section is an built-in portion of a healthy support economic system. Typical the supply of hazard capital enables the formation and growing of concerns that would non be able to raise other signifiers of finance due to the hazard profile of such investings.

In 2010, SAVCA commissioned a reappraisal of all VC support in the last 10 old ages based on our belief that an adequately big organic structure of empirical grounds has developed in South Africa, doing possible a comprehensive and utile analysis of VC activity. ( J P Fourie 2010 ) .The term entrepreneurship in concern has advantages and disadvantages.The advantages of being enterpriser are people can gain a batch of money from their concern. It can go on if their concern is really interesting to the client. And that status can do the concern more celebrated in society.

Beside it, by becomes an enterpriser, people can find their hereafter by themselves.

It is caused that the people who are enterprisers should:FormManageCalculate the hazards of their concern by themselves.

So therefore an entrepreneurship can take the people to gain a batch of money and as the stock for the hereafter.The of import thing is an enterpriser will take the benefit for him or herself merely. On the other manus, an entrepreneurship besides gives some disadvanges for the people. For illustration, the people who are enterprisers will non hold more clip to merely loosen up or reviewing. It is because they have to work for long hours to pull off the concern.Entrepreneurs organize and manage the concern themselves. Even, if they can non manage the concern, they can fall down and neglect.

In some instances, that status was happened to the passive and uncreative people or enterprisers. While in the active and originative enterprisers, that status will non go on. ( Entrepreneurs Line 2012 ) .There is perfectly no uncertainty that endeavor development is the key when it comes to little concern development for South African enterprisers. Gone are the yearss when you could merely go forth school, survey and so acquire a occupation. With more and more people in the market place, and fewer corporate occupations to travel around, a big per centum of school departers remain unemployed, trusting household members will be able to back up them.

That is fact of life in the 21th century.But – and it is n’t a really large but either – if you are able to place chances and create and successfully turn your ain concern, you can do a good life and lend toward the economic system of the state at the same clip. You will be able to populate comfortably and be a valuable member of society.

Entrepreneurs are indispensable to economic development everyplace

It has been said that economic development is straight related to the degree of entrepreneurial activity in any state. This is because there merely are n’t plenty regular occupations to travel about, and people who would otherwise be unemployed, have to do money to populate, non merely that entrepreneurial development besides adds value to society as a whole.Peoples improve themselves and make chances for other people. They besides make merchandises and services available, many of which are more low-cost than those by big corporations.

Recent progresss in entrepreneurship research indicate that the differences in enterprisers and the heterogeneousness in their behaviours and actions can be traced back to their laminitis ‘s individuality. For case, Fauchart and Gruber ( 2011 ) have late utilized societal individuality theory to exemplify that enterprisers can be distinguished in three chief types: Darwinians, Communitarians and Missionaries. These types of laminitiss non merely diverge in cardinal ways in footings of their self-views and their societal motives in entrepreneurship, but besides engage reasonably otherwise in new steadfast creative activity.

Influences and features of entrepreneurial behaviour

Management accomplishment and strong squad edifice abilities are frequently perceived as indispensable leading attributes for successful enterprisers.

Robert B. Reich considers leading, direction ability, and team-building as indispensable qualities of an enterpriser.This construct has its beginnings in the work of Richard Cantillon in his Essai Sur La Nature du Commerce nut ( 1755 ) and Jean-Baptiste Say [ 5 ] in his Treatise on Political Economy.

Psychological surveies show that the psychological leanings for male and female enterprisers are more similar than different. A turning organic structure of work shows that entrepreneurial behaviour is dependent on societal and economic factors. For illustration, states with healthy and diversified labour markets or stronger safety cyberspaces show a more favourable ratio of opportunity-driven instead than necessity-driven adult females enterprisers. Empirical surveies suggest that work forces entrepreneurs possess strong negotiating accomplishments and consensus-forming abilities.Research surveies that explore the features and personality traits of, and influences on, the enterpriser have come to differing decisions. Most, nevertheless, agree on certain consistent entrepreneurial traits and environmental influences.

Although certain entrepreneurial traits are required, entrepreneurial behavior are besides dynamic and influenced by environmental factors. Shane and Venkataraman ( 2000 ) argue that the enterpriser is entirely concerned with chance acknowledgment and development, although the chance that is recognised depends on the type of enterpriser ; while Ucbasaran et Al. ( 2001 ) argue there are many different types contingent upon environmental and personal fortunes.

Jesper Sorensen has argued that some of the most important influences on an person ‘s determination to go an enterpriser are workplace equals and the societal composing of the workplace.In researching the likeliness of going an enterpriser based upon working with former enterprisers, Sorensen discovered a correlativity between working with former enterprisers and how frequently these persons become entrepreneurs themselves, compared to those who did non work with enterprisers. The societal composing of the workplace can act upon entrepreneurism in workplace equals by turn outing a possibility for success, doing a “ He can make it, why ca n’t I? ” attitude. As Sorensen stated, “ When you meet others who have gone out on their ain, it does n’t look that loony.

Percept of enterprisers

The ability of enterprisers to introduce is thought to associate to innate traits such as extraversion and a propensity for risk-taking.

Harmonizing to Schumpeter, the capablenesss of innovating, presenting new engineerings, increasing efficiency and productiveness, or bring forthing new merchandises or services, are characteristic qualities of enterprisers.Entrepreneurs are accelerators for economic alteration, and research workers argue that enterprisers are extremely originative persons with a inclination to conceive of new solutions by happening chances for net income or wages.Largely due to the influence of Schumpeter ‘s heroic constructs of enterprisers, it is widely maintained that enterprisers are unusual persons. In line with this position, there is an emerging research tradition look intoing the familial factors that are perceived to do enterprisers so typical ( Nicolaou and Shane, 2009 ) .However, there are besides critical positions that attribute these research attitudes to oversimplified methodological and/or philosophical premises ( Gartner, 2001 ) . For illustration, it has been argued that enterprisers are non that typical, but that it is in kernel unrealistic prepossessions about “ non-entrepreneurs ” that maintain praiseful portrayals of “ enterprisers ” ( Ramoglou, 2011 ) .

Categorization of enterprisers – Based on functional features:

Advanced enterpriser:

Such enterprisers introduce new goods or new methods of production or detect new markets or reorganise the endeavor. Ex-husband: new merchandise, new ways of merchandise, new markets and reorganize the endeavor.

Imitative or adoptive enterpriser:

Such enterprisers do n’t introduce or copy engineering or technique of others. .

Fabian enterpriser:

Such enterpriser show grates state of affairs and agnosticism in experimenting with any alteration in their endeavor. They change merely when there is a serious menace to the really being of the endeavor.

Drone enterprisers:

Such enterprisers are characterised by a diehard conservativism and may even be prepared to endure the losingss. Ex-husband: Acc.

To MC Kinsey in 2015, 110-130 million people will be unemployed out of which 90-100 million people will be Fresher.

Prime mover:

This enterpriser sets in gesture a powerful sequence of development enlargement and variegation of concern.Director: Such an enterpriser does n’t originate enlargement and its content in merely remaining in concern.

Minor pioneer: This enterpriser contributes to economic advancement by happening better usage for bing resources. Ex-husband: minimal wastage maximal production.Satellite: This enterpriser assumes a providers function and easy travel towards a productive endeavor.Local trading: Such enterpriser bounds his endeavor to the local market.Venture capital ( VC ) is fiscal capital provided to early-stage, high-voltage, high hazard, growing startup companies. The venture capital fund makes money by having equity in the companies it invests in, which normally have a fresh engineering or concern theoretical account in high engineering industries, such as biotechnology, IT, package, etc.

The typical venture capital investing occurs after the seed support unit of ammunition as growing support unit of ammunition ( besides referred to as Series A unit of ammunition ) in the involvement of bring forthing a return through an eventual realisation event, such as an IPO or merchandise sale of the company. Venture capital is a subset of private equity. Therefore, all venture capital is private equity, but non all private equity is venture capital. [ 1 ]In add-on to angel investment and other seed support options, venture capital is attractive for new companies with limited runing history that are excessively little to raise capital in the public markets and have non reached the point where they are able to procure a bank loan or finish a debt offering. In exchange for the high hazard that venture capitalists assume by puting in smaller and less mature companies, venture capitalists normally get important control over company determinations, in add-on to a important part of the company ‘s ownership ( and accordingly value ) .

Venture capital is besides associated with occupation creative activity ( accounting for 2 % of US GDP ) , [ 2 ] the cognition economic system, and used as a proxy step of invention within an economic sector or geographics. Every twelvemonth, there are about 2 million concerns created in the USA, and 600-800 get venture capital support. Harmonizing to the National Venture Capital Association, 11 % of private sector occupations come from venture backed companies and venture backed gross histories for 21 % of US GDP. [ 3 ]It is besides a manner in which public and private histrions can build an establishment that consistently creates webs for the new houses and industries, so that they can come on.

This establishment helps in placing and uniting pieces of companies, like finance, proficient expertness, know-hows of selling and concern theoretical accounts. Once incorporate, these endeavors win by going nodes in the hunt webs for planing and edifice merchandises in their sphere.In 2007, the European Parliament introduced a new budget line entitled “ Erasmus for Young Entrepreneurs ” .

The European Commission so started to plan the Pilot Project with the purpose of back uping mobility periods abroad for late established and nascent enterprisers, with a position to bettering their accomplishments and furthering the cross-border transportation of cognition and experience between enterprisers.Erasmus for Young Entrepreneurs comes under the Small Business Act for Europe which considers this enterprise a cardinal part “ to make an environment within which enterprisers and household concerns can boom and entrepreneurship is rewarded ” .Erasmus for Young Entrepreneurs is to a certain extent similar to the well-known Erasmus Programme for pupils since it is a mobility action which addresses a peculiar mark group.However, it is besides clearly different: whereas the bing Erasmus programme in higher instruction enhances student-to-university relationships, the new Erasmus for Young Entrepreneurs focuses on business-to-business relationships. The assorted EU mobility programmes are complementary to each other offering mobility chances to different mark groups at different minutes of life. [ 3 ]Entrepreneurs are playing an progressively of import function in the South African economic system and harmonizing to the results from The Entrepreneurial Dialogues in 2010, these persons need to be identified and nurtured ( Fal, Sefolo, Williams, Herrington, Goldberg & A ; Klaassen, 2010 ) .

‘South Africa needs a vivacious new concern ecosystem to bring forth the sort of occupation growing necessary to do a dent in the 25 % unemployment rate stalking this state. We know SMEs and new concerns are the lone sustainable manner to make economic growing and employment, yet the environment can be peculiarly unfriendly to fledglings, burdened with administrative ruddy tape and the deficiency of entree to capital ‘ ( Charalambous, 2012, p.1 )However, it is non lone fledglings who are faced with challenges. Entree to capital was discussed at length in The Entrepreneurial Dialogues by Fal et Al.

( 2010 ) , and the penetrations clearly show that there is a gulf between the enterprisers and funders with respects to:Excessively many enterprisers in concentrated markets / industries make them less attractive to funders ;The enterprisers are most frequently un-researches and unprepared for the drawn-out procedure of accessing support ;Entrepreneurs ‘ outlooks are non managed. They expect a speedy and easy procedure and tend to go really pessimistic when this does non go on ;In the bulk of instances the perceptual experience is that capital is the chief ground for concern success, whereas there are assorted factors, including the enterpriser him- or herself which play a function in the concern succeeding ;Discrepancies in fiting between funding authorizations, standards used and the enterpriser ‘s eligibility.Based on these penetrations, the recommendation was that a more direct attack is needed to turn to this perceptual experience spread and this could be achieved by analyzing feedback from entrepreneurial groups on their experiences in seeking to entree capital ( Fal et al. , 2010 ) .Given this context, the purpose of this survey is to make a comprehensive apprehension of the standards used for measuring entrepreneurial ventures within South Africa. A comprehensive apprehension will be created by researching the differences and similarities between funders ‘ usage of rating standards and enterprisers ‘ experiences in the application of these standards by funders during each growing phase.

Therefore, the writer intends lending to the turning organic structure of cognition on entrepreneurial support, but most significantly to bridge the perceptual experience spread between these two stakeholders.

Scope of the research

This survey will be conducted within the boundaries of South Africa, with a specific focal point on enterprisers and funders. In the context of this survey, funders are categorised as venture capital houses and banking establishments which invest in entrepreneurial ventures. The focal point will moreover be on researching all growing stages.


The Entrepreneur

Sarasvathy ( 2004 ) stated that persons need to be motivated to go and win as enterprisers, and went farther by foregrounding that a limitation of pick in a assortment of hazard capital is needed. Several illustrations of the challenges that prevent little and average endeavors from spread outing operations in developing states are listed by Leo ( 2010 ) . These include a deficiency of entree to funding instruments designed for their demands. Entrepreneurs face budget restraints that limit passing on resources ( Allen & A ; Hall, 2009 ) .

Forms of support

An Entrepreneur ‘s most likely beginning of outside finance is listed by Van Osnabrugge and Robinson ( 2000 ) as being:Founder, household and friends ; besides named as SEED FUNDING the initial capital used to get down a concern. Seed capital frequently comes from the company laminitis ‘s personal assets or from friends and household.

Seed money is typically used to pay for preliminary operations like market research and merchandise development. Seed support is non usually associated with VC fund directors, particularly non in South Africa.Seed investings did non have in any of the old ages except 2008. Many critics of the South African VC plus category rapidly point to the deficiency of seed investing in South Africa.

( SAVCA 2010 ) .START UP CAPITAL: Support used for puting up operations ( engaging staff, leasing office infinite, fiting the production system, commercializing rational belongings, and other activities.DEVELOPMENT CAPITAL ( MOSTLY PRE-REVENUE DEALS ) – Finance used after start-up capital to further establish the concern and grow market portion in order to go profitable.GROWTH CAPITAL ( POST-REVENUE DEALS ) – Equity type investings used to help established but still bad ventures in spread outing activity such as establishing into foreign markets, making new merchandise / engineering lines, speed uping production and / or geting rivals.

Beginning and extent of support

Business Angels typically put their ain financess, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund. Although typically reflecting the investing judgement of an person, the existent entity that provides the support may be a trust, concern, limited liability company, investing fund, etc. The Harvard study by William R. Kerr, Josh Lerner, and Antoinette Schoar tables grounds that angel-funded startup companies are less likely to neglect than companies that rely on other signifiers of initial funding.Angel capital fills the spread in start-up funding between “ friends and household ” – ( sometimes humorously given the acronym FFF, which stands for “ friends, household and saps ” ) who provide seed funding-and venture capital.Although it is normally hard to raise more than a few hundred thousand dollars from friends and household, most traditional venture capital financess are normally non able to see investings under US $ 1-2 million.Therefore, angel investing is a common 2nd unit of ammunition of funding for high-growth start-ups, and histories in sum for about as much money invested yearly as all venture capital financess combined, but into more than 60 times as many companies ( US $ 20.1 billion vs.

$ 23.26 billion in the US in 2010, into 61,900 companies vs. 1,012 companies ) .Of the US companies that received angel support in 2007, the mean capital raised was about US $ 450,000 [ .

However, there is no “ set sum ” for angel investors, and the scope can travel anyplace from a few 1000, to a few million dollars.In a big displacement from 2009, in 2010 health care / medical accounted for the largest portion of angel investings, with 30 % of entire angel investings ( vs. 17 % in 2009 ) , followed by package ( 16 % vs.

19 % in 2007 ) , biotech ( 15 % vs. 8 % in 2009 ) , industrial/energy ( 8 % vs. 17 % in 2009 ) , retail ( 5 % vs. 8 % in 2009 ) and IT services ( 5 % ) . Angel funding, while more readily available than venture funding, is still highly hard to raise. However some new theoretical accounts are developing that are seeking to do this easier. ] Many companies who receive angel support are required to register a Form D with the Securities and Exchange Commission.

Investing profile

Angel investings bear highly high hazard and are normally capable to dilution from future investing unit of ammunitions.

As such, they require a really high return on investing. Because a big per centum of angel investings are lost wholly when early phase companies fail, professional angel investors seek investings that have the possible to return at least 10 or more times their original investing within 5 old ages, through a defined issue scheme, such as programs for an initial public offering or an acquisition. Current ‘best patterns ‘ suggest that angels might make better puting their sights even higher, looking for companies that will hold at least the possible to supply a 20x-30x return over a five- to seven-year keeping period. After taking into history the demand to cover failed investings and the multi-year retention clip for even the successful 1s, nevertheless, the existent effectual internal rate of return for a typical successful portfolio of angel investings is, in world, typically as ‘low ‘ as 20-30 % .While the investor ‘s demand for high rates of return on any given investing can therefore do angel financing an expensive beginning of financess, cheaper beginnings of capital, such as bank funding, are normally non available for most early-stage ventures, which may be excessively little or immature to measure up for traditional loans.

Profile of investor community

The term “ angel ” originally comes from Broadway where it was used to depict affluent persons who provided money for theatrical productions.Angel investors are frequently retired enterprisers or executives, who may be interested in angel puting for grounds that go beyond pure pecuniary return.These include desiring to maintain abreast of current developments in a peculiar concern sphere, mentoring another coevals of enterprisers, and doing usage of their experience and webs on a less than full-time footing. Therefore, in add-on to financess, angel investors can frequently supply valuable direction advice and of import contacts.

Because there are no public exchanges naming their securities, private companies meet angel investors in several ways, including referrals from the investors ‘ sure beginnings and other concern contacts ; at investor conferences and symposia ; and at meetings organized by groups of angels where companies pitch straight to investor in face-to-face meetings.Harmonizing to the Center for Venture Research, there were 258,000 active angel investors in the U.S.

in 2007.The past few old ages, peculiarly in North America, have seen the outgrowth of webs of angel groups, through which companies that apply for support to one group are so brought before other groups to raise extra capital.

Angel puting in the United states

Geographically, Silicon Valley dominates the finish of angel financess, having 39 % of the $ 7.5B invested in US-based companies throughout Q2 2011, 3-4 times every bit much as the entire sum invested within New England.

Angel puting in the UK

A survey by NESTA in 2009 estimated that there were between 4,000 and 6,000 angel investors in the UK with an mean investing size of ?42,000 per investing. Furthermore, each angel investor on norm acquired 8 per cent of the venture in the trade with 10 per cent of investings accounting for more than 20 per cent of the venture.In footings of returns, 35 per centum of investings produced returns of between one and five times of the initial investing, whilst 9 per cent produced returns of multiples of 10 times or more. The average return, nevertheless, was 2.

2 times investing in 3.6 old ages and an approximative internal rate of return of 22 per cent gross.The UK Business Angel market grew in 2009/2010 and, despite recessive concerns, continues to demo marks of growing.VENTURE CAPITALISTS: VC refers to investings provided to early-stage, innovate, and high growing start-up companies. A commen feature of all venture capital investings is that investee companies do non hold hard currency flows to pay involvement on debt or dividends on equity. Rather, investmnets are made with a position towards capital addition on issue. The most sought after issue mobs are an initial public offering ( IPO ) , where a company list on a stock exchange for the first clip, and an acquisition issue ( merchandise sale ) , where the company is sold in entireness to another company. However, VC ‘s may go out by secondary gross revenues, where the enterpriser retains his or her portion but the VC sells to another company or another investor, redemptions, where the enterpriser repurchases the VC ‘s involvement, and write-downs or settlements.

The Oxford Handbook of Venture Capital provides a comprehensive image of all of the issues covering with the construction, administration, and public presentation of venture capital. It comprises parts from 55 writers presently based in 12 different states ( Douglas J. Cumming ) 2012 ) .

Banking Institution: A banking establishment ( besides referred to as a universal or commercial bank ) can run from a big fiscal establishment with a extremely seeable trade name name and an international presence to a little organisation with a local presence.

A banking establishment ‘s funding activities by and large involve assorted types of loaning, such as corporate finance, lodging, undertaking finance, retail, short-run finance, small-medium endeavors, trade, and others.

Alternatively, the focal point of a banking establishment may be merely on specific minutess with clients that meet certain demands and within certain industry sectors. Banking establishments may besides supply fiscal merchandises with a focal point on environmental concern chances.A banking establishment ‘s exposure to environmental and societal hazards varies greatly as a map of the clients within its portfolio. Some banking establishments normally have extremely seeable trade names in their markets or globally, and are peculiarly susceptible to reputational hazard. Banking establishments are besides driven to better their environmental and societal hazard direction capacity to cut down recognition and liability hazards originating from environmental and societal issues. A figure of banking establishments have publically committed themselves to sustainable banking, and many have voluntarily adopted the rules established under assorted sustainability enterprises.NON -FINANCIAL CORPORATIONS: Definition:

The sector non-financial corporations consists of institutional units whose distributive and fiscal minutess are distinguishable from those of their proprietors and which are market manufacturers, whose chief activity is the production of goods and non-financial services

The sector non-financial corporations besides include non-financial quasi-corporations.The term ‘non-financial corporations ‘ denotes all organic structures recognised as independent legal entities which are market manufacturers and whose chief activity is the production of goods and non-financial services.

The institutional units covered are the undermentioned:

A private and public corporations which are market manufacturers chiefly engaged in the production of goods and non-financial services ;Co-operatives and partnerships recognised as independent legal entities which are market manufacturers chiefly engaged in the production of goods and non-financial services ;Public manufacturers which by virtuousness of particular statute law are recognised as independent legal entities and which are market manufacturers chiefly engaged in the production of goods and non-financial services ;Non-profit establishments or associations functioning non-financial corporations, which are recognised as independent legal entities and which are market manufacturers chiefly engaged in the production of goods and non-financial services een00043.gif ;Keeping corporations commanding ( see paragraph 2.26. ) a group of corporations which are market manufacturers, if the overriding type of activity of the group of corporations as a whole – measured on the footing of value added – is the production of goods and non-financial services ;Private and public quasi-corporations which are market manufacturers chiefly engaged in the production of goods and non-financial services.The term ‘non-financial quasi-corporations ‘ denotes all organic structures without independent legal position which are market manufacturers chiefly engaged in the production of goods and non-financial services and run into the conditions measure uping them as quasi-corporations ( see paragraph.

The sector non-financial corporations besides includes all fanciful occupant units ( see paragraph 2.15. ) which, by convention, are treated as if they were quasi-corporations.Control over a corporation is defined as the ability to find general corporate policy by taking appropriate managers, if necessary.

A individual institutional unit ( another corporation, a family or a authorities unit ) secures control over a corporation by having more than half the vote portions or otherwise commanding more than half the stockholders ‘ vote power. In add-on, authorities secures control over a corporation as a consequence of particular statute law edict or ordinance which empowers the authorities to find corporate policy or to name the managers.In order to command more than half the stockholders ‘ vote power, an institutional unit needs non ain any of the vote portions itself.

A corporation C could be a subordinate of another corporation B in which a 3rd corporation A owns a bulk of the vote portions.Corporation C is said to be subordinate of corporation B when: either corporation B controls more than half of the stockholders ‘ voting power in corporation C or corporation B is a stockholder in C with the right to name or take a bulk of the managers of C.

The sector non-financial corporations is divided into three sub-sectors:

1. Public non-financial corporations2. National private non-financial corporations3. Foreign controlled non-financial corporations


The term initial public offering ( IPO ) slipped into mundane address during the tech bull market of the late ninetiess.

Back so, it seemed you could n’t travel a twenty-four hours without hearing about a twelve new dotcom millionaires in Silicon Valley who were cashing in on their latest Initial public offering. The phenomenon spawned the term siliconaire, which described the dotcom enterprisers in their early 20s and 30s who all of a sudden found themselves populating big on the returns from their cyberspace companies ‘ IPOs.An initial public offering, or IPO, is the first sale of stock by a company to the populace. A company can raise money by publishing either debt or equity. If the company has ne’er issued equity to the populace, it ‘s known as an IPO.

Companies fall into two wide classs: Private and Public.

A in private held company has fewer stockholders and its proprietors do n’t hold to unwrap much information about the company.

Anybody can travel out and integrate a company: merely set in some money, file the right legal paperss and follow the coverage regulations of your legal power. Most little concerns are in private held. But big companies can be private excessively.

Did you know that IKEA, Domino ‘s Pizza and Hallmark Cards are all in private held. ( Investopedia )Business angels ;Venture capitalists ;Banking establishments ;Non-financial corporations ;IPOs and equity markets.ACCESS-ICT ( 2012 ) breaks the assorted beginnings of finance down into a ladder of finance ( Figure 2.1 ) on their web site, bespeaking that venture capital expects high returns for the hazard they take and is targeted at early phase high growing companies.The administration for economic co-operation and development ( OECD ) ( 2006 ) argues that the venture capitalist house may take part at any phase of the procedure, from seed support, before production has begun, to enlargement. EVCA ( 2007 ) agrees with this and goes farther – that funders have a peculiar accent on entrepreneurial projects instead than on mature concerns.

This raises the inquiry as to whether the standards used by funders to measure companies in different growing phases are similar. ACCESS-ICT ( 2012 ) lists the different growing phases:The seed capital phase, where the enterpriser has an thought and funders willing to supply funding up to a‚¬50A 000 ;The start-up phase, where the enterpriser have researched the market and established a working paradigm and funders willing to supply funding up to a‚¬50A 000 ;The early phase, where the enterpriser has completed the merchandise and generated gross revenues and funders willing to supply support between a‚¬50A 000 and a‚¬1million ;Growth and enlargement phase, where the enterpriser has an established concern, bring forthing net incomes and needs support to develop new merchandises and research new markets and funders willing to supply support from a‚¬750A 000.Figure 2. : Ladder of financeBeginning: ACCESS-ICT ( 2012, p. 2 )


3. Differences between debt and equity

The chief differences between debt and equity support were summarised in a table signifier by Van Eeden ( 2004 ) . The tabular array clearly indicates that banking establishments are non involved in the future growing chances of a concern.

Table 2. : Venture Capital versus DebtBeginning: Van Eeden ( 2004, p. 7 )South Africa continued to experience the effects of a sulky planetary economic system, albeit on a more limited footing as compared with the remainder of the universe. After the fiscal crisis at the terminal of 2008, amalgamations and acquisitions started picking up once more in the early portion of 2010 and this tendency continued into 2011. In the early portion of 2012 fewer big trades were announced, but anecdotally, there are big trades in the grapevine that could ensue in proclaimed trades when greater market assurance returns.

Most recent M & A ; A activity has been in the little to mid-cap sectors and between unlisted entities. M & A ; A activity has besides been more marked in cross-border trades in South Africa, inward investing into South Africa and investing from South Africa into other African legal powers.Many of the recent minutess ( peculiarly in the resources sector ) have involved Chinese, Indian, Nipponese and US parties. There were once more comparatively few black economic authorization ( ‘BEE ‘ ) trades, which for a figure of old ages provided great drift to the South African M & A ; A market. Chiefly due to the higher cost of debt, the private equity market in South Africa is still slow in both the figure and value of trades. Deal flow has, nevertheless, started to increase in 2011, however the cost of debt remains prohibitory. It will be interesting to see how the remainder of 2012 pans out, but all marks point to favorable activity in the M & A ; A market. ( Ezra Davids and Ashleigh Hale )


A funder is a individual who provides money or fiscal support for something, a supplier of financess as for the support of a charitable or non-profit organisation.

A Mid Atlantic fund for engineering start-ups and active investors with specialisations in cyber security, substructure, Mobile, and endeavor platforms said the followers:

We portion openly and bask working with people who make things go on! A We take an active function in the lives of our portfolio companies. We believe in the corporate success of the laminitiss, the direction squad, and the investors. Pivots happen and we ‘ve been a portion of many ; it ‘s all portion of the procedure. Disruptive and emerging engineering coupled with a concern theoretical account that drives invention, managed by dedicated laminitiss – that ‘s what we are all about. Our spouses and wise mans are matched with advanced laminitiss as an indispensable portion of the procedure at

Banking establishments

A banking establishment ( besides referred to as a universal or commercial bank ) can run from a big fiscal establishment with a extremely seeable trade name name and an international presence to a little organisation with a local presence.

A banking establishment ‘s funding activities by and large involve assorted types of loaning, such as corporate finance, lodging, undertaking finance, retail, short-run finance, small-medium endeavors, trade, and others.Alternatively, the focal point of a banking establishment may be merely on specific minutess with clients that meet certain demands and within certain industry sectors. Banking establishments may besides supply fiscal merchandises with a focal point on environmental concern chances.

A banking establishment ‘s exposure to environmental and societal hazards varies greatly as a map of the clients within its portfolio. Some banking establishments normally have extremely seeable trade names in their markets or globally, and are peculiarly susceptible to reputational hazard.Banking establishments are besides driven to better their environmental and societal hazard direction capacity to cut down recognition and liability hazards originating from environmental and societal issues. A figure of banking establishments have publically committed themselves to sustainable banking, and many have voluntarily adopted the rules established under assorted sustainability enterprises. ( International Finance Corporation )Debt funding is explained by Barringer and Ireland ( 2008 ) as acquiring a loan or selling corporate bonds and focal points on obtaining loans. Lenders insist on ample collateral to to the full protect the loan, which can include the enterpriser ‘s personal assets to be collateralised as a status of the loan.Van Osnabrugge and Robinson ( 2000 ) reiterated the determination by Moore ( 1994 ) that bank loans are one of the extremely sought after options to funding to a start- up house in the hi-tech industry, but that merely 7 per centum of such houses really succeeded obtaining support for their venture.

They go farther adapting from Roberts ( 1991 ) and province that for those mature houses raising a 2nd unit of ammunition of support, commercial Bankss become an of import beginning of finance.

Venture Capitalists

Barringer and Ireland ( 2008 ) defines venture capital houses as houses who raise money in financess, typical from $ 75million to $ 200million to put in start-ups and growing houses, typically 20 to 30 companies over a 3 to 5 twelvemonth period, who manage the fund and have an one-year direction fee, in add-on to 20 to 25 % of the net incomes earned by the fund. ACCESS-ICT ( 2012 ) explains that a venture capital house will do larger investings than concern angels ( from 3million to 5million euros ) , which it will raise from institutional and single investors and usage to purchase companies with high growing potency.

The OECD ( 2006 ) explains that venture capitalists find persons with strong direction background and diversify their investings, thenceforth they screen possible trades, raise financess and so construction funding and proctor public presentation.Some investors prefer a “ hands-on ” attack as they wish to run really closely with the enterpriser and his squad, compared to a “ hands-off ” attack if the enterpriser ‘s squad is more experient and the investor would prefer to be less involved in the twenty-four hours to twenty-four hours operations of the concern and will merely prosecute in the event of a crisis ( EVCA, 2007 ) .EVCA ( 2007 ) besides discusses that some investors would prefer to be present as board members, which allows the company the benefit from the experience of a more active board member, who will besides take portion in the of import commissions.

Advantages and disadvantages of utilizing Venture Capital

A company ‘s grounds for make up one’s minding to publically name on the stock exchange frequently include the ability to acquire entree to the capital markets for fiscal enlargement and acquisitions. They normally have invested many old ages of ploughing back net incomes and vouching adoptions and instead than sell out, they wish to stay with the company and be portion of its future growing.Even if your concern is suited to flotation, it may non be the right pick for you.

There are a figure of cardinal advantages and disadvantages to weigh up: –


You get entree to new capital to develop the concernA float makes it easier for you and other investors to recognize your investingYou can offer employees excess inducements by allowing portion optionsBing a public company can supply clients and providers with added reassuranceYour company may derive a higher public profile, which can be good for concernHaving your ain traded portions gives you greater possible for geting other concerns, because you can offer portions every bit good as hard currencyPersonal warrants of managers are non normally required for adoptions


Your concern may go vulnerable to market fluctuations, which are outside your control.If market conditions change during the flotation procedure you may hold to abandon the float.The costs of flotation can be significant and there are besides ongoing costs such as higher professional fees.You will hold to see stockholders ‘ involvements when running the company – which may differ from your ain aims.You may hold to give up some direction control of the concern and finally there ‘s a hazard that the company could be taken over.

Public companies have to follow with a broad scope of extra regulative demands and meet recognized criterions of corporate administrationDirectors could be distracted from running the concern by the demands of the flotation procedure, and by covering with investors afterwardsIt by and large takes 6 months to publically name a company on the stock exchange although the clip period can run from 3 months to 2 old ages. You will necessitate a scope of professional advisers to help with the legal, fiscal, accounting and rating facets of publically naming plus prospectus readying, underwriting of portions and aid with IPO Plans. ( Len Mcdowall 2007 )Zacharakis and Meyer ( 2000 ) refer to Gupta and Supienza ( 1992 ) , who suggested that venture capital houses add value by conveying investors and entrepreneurs together, doing superior investing determinations and supplying non-financial aid which enhances endurance. The venture capitalist offers fiscal, managerial and marketing support to the venture until it materializes ( Al-Suwailem, 1998 ) .

2.4.4. Different types of “ trades ”

Gladstone and Gladstone ( 2004 ) tabular arraies six groupings of trades ( Table 2.

2 ) from “ Large Winners ” where approximately 90 % or 100 % return on investing is received to “ Wipeout ” trades, where investors lose all of their investing if it can non be avoided.Table 2. : Types of trades


Tax return on

Investing ( % )

Probability of

doing projection

( % )

Leaden norm ( Return on Investment chance ) ( % )

Large Winner1001010Winner305015Sideways10202Workout0100Loser( 50 )5( 2.5 )Wipeout( 100 )5( 5 )Beginning: Gladstone and Gladstone ( 2004, p.185 )

Standards for choosing investings

1. Management

Management, in other words the squad.

This is the individual most of import portion of the investing standard that investors use to rate their possible investings. In squads, Following Ventures, looks into both the deepness / quality of the squad, but besides into how diversified they are. Teams need to hold assorted skill sets. There needs to be a clear concern focal point, but besides a really deep apprehension of the industry the company works in.Naturally, other facets of enterprisers are besides graded and looked at ; how good are the people in the squad prepared to work in the face of high hazard and uncertainness, how good are they organized to prosecute the chance, how dynamic is the squad if they need to alter class and so on. One of the ways enterprisers can look at this is that when investors look into early phase companies, there is seldom anything else to back up the investing determination than a strong and a qualified squad.

( By Antti Vilpponen, November 24, 2010 )

2. Feasible Merchandise or Service A

It is indispensable that any merchandise or service be executable and feasible, we target companies that can show that hazard will be minimized while guaranting that the cogent evidence of construct is moderately sound. This includes the potency for rapid client or concern credence and a targeted client base. Each program must besides see the appropriate merchandise or service pricing threshold and present a clear client demands appraisal. ( 2011 )


Market possible

Another really clear and obvious standard for investors. Since VCs look into high possible countries where they could go out their investings at a higher rating – the demand for the company ‘s services need to be supported by a strong market.There are a few things sing the market investors look at on top of the obvious size of it. These issues are for illustration the growing and/or internal kineticss of the market, the degree of competition, entree to the market, what distribution mechanics work in the market and what at what phase is the market – timing is indispensable. ( By Antti Vilpponen, November 24, 2010 )

4. The Fundss

Finally, the last standards are the fiscal position of the company. There are four smaller points to look at and they are the usage of the financess, funding footings, fiscal hazard and the potency of a 10x return on investing.

The usage of financess is of import, because investors want to see how you ‘ll be utilizing the financess to turn your concern. If you ‘re paying debt off, it ‘s likely non a good thought for an investor to be puting in your company. Financing footings are of import and vary from investor to investor. These will be covered in more item in the term sheet and are seldom one of the cardinal points in the dialogues. ( By Antti Vilpponen, November 24, 2010 )Financial hazard means what kinds of hazards are involved with the current investing. These can be for illustration, if the company needs farther funding to finish the R & A ; D of its merchandises, will at that place be a hazard that market conditions will alter and the company will necessitate more support, etc.

Finally, the inquiry on where all venture capitalists make their money – will the issue potency of the investing be many fold?

Investing Standards

ManagementInvestors should look into factors impacting direction determination and policy devising, such asManagement moralssCorporate administration conformityBEE AccreditationConflict of involvementMerchandiseMonetary values of merchandisesRivalsMarket share- alone merchandisesMarketJSEReputable providerCustomersIndustry sectorFinanceRatio- net income border and current ratioNet incomes per ..

. /how-conflicts-of-interest-thwart-institutiona..

. Finance Authority of Maine ( FAME ) ( 2003 ) lists the investing rules guided by most houses as being:Be extremely selectiveSeek companies with advanced merchandisesBack outstanding direction squadsInvest in companies with a clear and realistic issue schemeAdd value and play a important function in the direction of the companyMake sure that companies have entree to enough hard currencyConstruct a diverse investing portfolioInvesting in squads and markets is highlighted by Engel ( 2011 ) , who further emphasis that one should extinguish hurting, and concentrate on client development and non merchandise development. He farther states the importance to give resources in phases, and ended his list saying that ‘entrepreneurs and venture capitalists are ever selling, but the company is ne’er for sale. ‘For venture capitalists, the enterpriser and thenceforth the initial feelings of the venture ‘s feasibleness remain the most of import determination factor, while the direction squad and financials can go critical later on in the investing, ( Van Osnabrugge & A ; Robinson, 2000 ) .

Hudson and Evans ( 2005 ) did an analysis of eight different surveies conducted between 1974 and 1993. They found that in six investing standards, 50 % or more of the eight surveies agreed. These standards were: Management accomplishments and experience ; the venture squad ; merchandise attributes ; market size ; market growing and expected return on investingAn extra standard was suggested as being of import, viz. competitory conditions, market portion and concern scheme, which approximates Porter ‘s theoretical account of the five forces of competition ( Hudson & A ; Evans, 2005 ) .Table 2. : Evaluation standards from: A reappraisal into venture capitalists ‘ determination devisingBeginning: Hudson and Evans ( 2005, p.

8 )Rakhman and Evans ( 2005 ) went farther and managed to direct a questionnaire to 450 possible respondents in 2002 of which some were venture capitalists, some investees and others enterprisers. They found that venture capitalists deem the fiscal facets and personality and experience of enterprisers as most of import and were less concerned with the handiness of natural stuff, selling accomplishments, just trading and legal actions.Entrepreneurs, on the other manus, rated the ability to pull off hazards, the merchandise being good accepted and the ability to pull clients as really of import, while the audited fiscal study and the relationship with venture capitalists as merely of import to entrepreneurs. To the investee honestness, openness and accessibility, the merchandise being good accepted, to pull clients and the venture capitalist to actively develop trust and relationship with investees are of import. Tax benefits were rated the lowest. ( Rakhman and Evans, 2005 ) . This was consistent with Tyebjee and Bruno ( 1984 ) , who argued that venture capitalists are non looking for revenue enhancement shelters.

The chief investing standards identified in surveies from 1970 to 2004 as reviewed by Khanin, Baum, Mahto and Heller ( 2008 ) is listed as follows:Top direction squad competence, accomplishments, expertness, featuresMarket and market growingSingularity of merchandiseAssorted hazardsProjected returns from investing to warrant a venture ‘s supportExit picksQuality of the tradeVenture schemeAnalysis of clients ‘ positionCompetitive menace in an industry sectorIt is clear from the assorted research extracts that the undermentioned properties are common and most often listed. These are direction, merchandise, fiscal and market, and were evaluated by Van Deventer and Mlambo ( 2009 ) .In Table 2.4, Van Deventer and Mlambo ( 2009 ) list their findings sing the standards rated as of import by take parting venture capitalists, with the enterpriser being honest and holding unity, good market credence for the merchandise or service is expected and the venture will supply a high internal rate of return ( IRR ) exceeding the list.

Table 2. : Standards rated as of import by take parting Venture CapitalistsBeginning: Van Deventer and Mlambo ( 2009, p. 39 )The standards as outlined by Van Deventer and Mhlambo ( 2009 ) will be used in this survey as these four classs – merchandise, direction, market and fiscal – were identified and verified through extended desk research by several writers.

The rating standards in item


The trustiness of the enterpriser is rated as the most of import standards by Van Osnabrugge and Robinson ( 2000 ) , followed by the enterprisers expertness and so his enthusiasm.Gladstone and Gladstone ( 2004 ) list the features which investors are looking for in an enterpriser. These are:working long hours to counterbalance for the deficiency of employees ;the ability to measure hazard and analyse complex state of affairss ;the ability to carry banking establishments to do loans ;transport an tremendous sum of item around with them ;personality that is compatible with the venture capitalist ;Excess points Gladstone and Gladstone ( 2004 ) list as of import to look for in an enterpriser ‘s experience are market cognition, a path record, leading and repute.

It is of import to enterprisers and investees to demo assurance. All groups rated experience as of import, followed by willingness to engage staff to cover failings in direction as desirable and stated that properties of importance are: honestness, openness and accessibility, enterpriser ‘s experience and hazard direction capablenesss ( Rakhman and Evans, 2005 ) .Van Deventer and Mlambo ( 2009 ) found the standards rated of import by venture capitalists as being the enterpriser ‘s honestness and unity, his desire for success, his direction accomplishments and being difficult working and flexible.


It is of import for an enterpriser to hold a good apprehension of the merchandises a company sells, its rivals every bit good as the seasonality which is common in most industries. The possible impact to a company ‘s hard currency flow should be discussed with the selling section every bit good as developments around the companies ‘ merchandises.

These issues are important when measuring the merchandise potency, ( Gladstone and Gladstone, 2004 ) .Rakhman and Evans ( 2005 ) list seven points for consideration under the merchandise class: handiness of natural stuffs, demonstrated market credence, length of clip in the market, working paradigm. They found differences in evaluations across assorted groups with the points: is proprietary, can otherwise be protected, handiness of natural stuffs and demonstrated market credence.Venture capitalists rated merchandises are in an early phase of life rhythm and the venture has production capablenesss in topographic point, as non of import, ( Van Deventer & A ; Mlambo, 2009 ) .


A venture capitalist needs to analyze the fiscal people before go oning to analyze the fiscal information, ( Gladstone and Gladstone, 2004 ) . They continue to discourse assorted ratio analysis which should be done by a venture capitalist, such as to cipher the gross revenues per gross revenues individual every bit good as the merchandising disbursals as a per centum of gross revenues.A venture capitalist can acquire a good apprehension of a concern by analyzing the one-year study of a new venture every bit good as the studies direction uses on a daily footing ( Gladstone and Gladstone, 2004 ) .The venture capitalists that Van Deventer and Mlambo ( 2009 ) assessed, rated a high internal rate of return as the highest standards, followed by high rating projections and thenceforth by the fact that there are important possible for net incomes growing.

The lowest rated was the point that the venture has low overall capital demands, followed by the demand for low selling and production costs.


Gladstone and Gladstone ( 2004 ) emphasis that a venture capitalist should seek to find whether a company is market-driven, as marketing-driven companies are normally high-growth companies. They continue to rede that it is of import to understand the motive behind the gross revenues force and so find if the motive is sufficient to sell the merchandise. Market growing, market information and selling schemes are some of the factors that the selling section should understand and be able to provide when requested.The lowest evaluation given by venture capitalists in the market class was that the venture will make a new market and will run in a non-competitive industry. This reflects that these two standards were non every bit of import as the demand for the merchandise and the potency for growing ( Rakhman & A ; Evans, 2005 ) .

When having an investing petition from a new venture, McKaskill ( 2009 ) high spots that it should speak about market cleavage, client purchasing forms and pricing theoretical accounts. He highlights that the followers should show a turning market with planetary potency that will be attractive to a major corporation in the long-run.The literature reappraisal indicates that there are assorted standards used by funders and that entrepreneurs experience or construe the importance of the standards otherwise compared to funders. Clearly there is no standard standards used by funders and this creates challenges for enterprisers. Worsening the challenge is that there is no clear apprehension or standard pattern sing at which phase of growing funders make investings.Harmonizing to Fal et Al. ( 2010 ) there is a gulf between the enterprisers and funders with respects to:Excessively many enterprisers in concentrated markets / industries make them less attractive to funders ;The enterprisers are most frequently un-researches and unprepared for the drawn-out procedure of accessing support ;Entrepreneurs ‘ outlooks are non managed.

They expect a speedy and easy procedure and tend to go really pessimistic when this does non go on ;In the bulk of instances the perceptual experience is that capital is the chief ground for concern success, whereas there are assorted factors, including the enterpriser him- or herself which play a function in the concern succeeding ;Discrepancies in fiting between funding authorizations, standards used and the enterpriser ‘s eligibility.These writers therefore recommend that farther research is needed to understand and bridge this spread in perceptual experiences.

Chapter 3: Research Question

Research Aims

In order to turn to the purpose of this survey, the research aims are to:Identify the differences and similarities between funders ‘ usage of standards in the different growing phases ;Identify the differences and similarities between enterprisers ‘ experience of standards in the different growing phases ;Identify the differences and similarities between funders ‘ usage of and enterprisers ‘ experience of standards in general ;Identify the differences and similarities between funders ‘ usage of and enterprisers ‘ experience of standards in the different growing phases.

Research Hypothesiss

The undermentioned research inquiries will be answered:Investigate Funders ‘ usage of standards between the growing stages ;H01: There are no differences in how Funders use standards between the growing phases.HA1: There are differences in how Funders use standards between the growing phases.Investigate Entrepreneurs experience of standards used between the growing stages ;H02: There are no differences in how Entrepreneurs experience the usage of standards by funders between the growing phases.HA2: There are differences in how Entrepreneurs experience the usage of standards by funders between the growing phases.Investigate Funders ‘ usage of and Entrepreneurs ‘ experience of standards between the growing stages ;H03: There are no differ


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