ABSTRACT
This chapter provides an overview of different funding options that are potentially available for new entrepreneurs and discuss the various opportunities and challenges. Drawing insight from various empirical contributions to the subject of venture funding we then consider the difficulties entrepreneurs face when accessing external finance. Business angels and venture capitalists focus on larger organizations requiring substantial amounts of funding rather than early-stage entrepreneurial ventures. New entrepreneurs have to create a resource base to invest in assets, fund business operations and support growth agendas: decisions regarding tangible resources including finance are critical. Many young entrepreneurs start with low levels of capitalization, and this has a major influence on the survival and growth prospects of their ventures. The resource-based view refers to both tangible and intangible resources as important sources of capabilities that contribute to the value-creation process. The value and quality of an entrepreneur’s ideas are difficult to judge and quantify.
