DefinePK

Research Objective

To test the relationships between business angels, entrepreneurial finance, and new venture performance in SMEs in Bahawalpur, Pakistan.

Methodology

Quantitative research using a cross-sectional survey design. Data was collected from 280 business owners/business angels of newly founded ventures in Bahawalpur, Pakistan, using a self-administered survey questionnaire, with an online survey being the preferred method due to COVID-19. Data analysis was performed using PLS-SEM with Smart PLS 3.

Methodology Flowchart

                        graph TD;
    A["Data Collection via Survey Questionnaire"] --> B["Data Analysis using PLS-SEM"];
    B --> C["Hypothesis Testing"];
    C --> D["Reporting Findings"];                    

Discussion

Business angels are crucial for early-stage risk capital and are more accessible for smaller investments than venture capital firms. They often take an active role in investee companies, leveraging their expertise and networks. The study's findings support the significant positive influence of business angels on both entrepreneurial finance and new venture performance, and the positive impact of entrepreneurial finance on new venture performance.

Key Findings

- Business angels have a positive effect on venture performance.
- Business angels have a positive effect on entrepreneurial finance.
- Entrepreneurial finance has a positive effect on new venture performance.

Conclusion

Business angels are a vital external source of early-stage capital, positively influencing entrepreneurial finance and new venture success. Entrepreneurial finance also plays a key role in driving new venture performance.

Fact Check

- 90% of startups in Pakistan do not achieve success.
- 280 responses were used in the data analysis from an initial distribution of 500 questionnaires.
- A T-value of 1.96 was used as the threshold for examining the significance of relationships between variables.

Mind Map