Growth in new technology-based firms: early partnerships and financial capital
Hans LöfstenPurpose
This study investigates the associations between initial external partnerships, financial resource mobilisation, and the early growth of micro-sized new technology-based firms (NTBFs).
Design/methodology/approach
Drawing on survey data from Swedish micro-sized NTBFs, the study tests four hypotheses concerning market-oriented and institutional partnerships, as well as informal and formal sources of external financing. The empirical approach combines Pearson correlation analysis with multiple regression models.
Findings
The results indicate that partnerships with subcontractors and universities/research institutes are positively associated with early firm growth, whereas partnerships with local authorities are negatively associated with growth within the externally funded subsample. The negative association with local authority partnerships should be interpreted cautiously, as it may partly reflect selection effects or underlying firm characteristics rather than a direct adverse effect. Within the small subsample of externally funded firms, exploratory results indicate that crowdfunding is positively associated with growth, while funding from family and friends is negatively associated with growth. These financing-source findings should be interpreted as exploratory and conditional.
Research limitations/implications
The financing analyses are based on a relatively small subsample of externally funded firms, and the findings are derived from Swedish NTBFs, limiting generalisability. Future research should employ longitudinal and comparative designs to further examine the role of external partnerships and financing in NTBF growth.
Practical implications
Managers of micro-sized NTBFs should prioritise partnerships with subcontractors and universities/research institutes and carefully evaluate the strategic value of different financing sources. Policymakers should strengthen mechanisms that facilitate university-industry collaboration and access to scalable financing channels.
Originality/value
The study contributes to entrepreneurship research by providing new empirical evidence on which external relationships and financing channels are associated with growth among micro-sized, young NTBFs – an often overlooked group in growth studies. It further offers policy-relevant insights by highlighting the heterogeneous value of different partnership types and funding sources in early-stage firm development.