Small Business Economics

, Volume 41, Issue 2, pp 315–334

Succession financing in family firms

  • Christian Koropp
  • Dietmar Grichnik
  • André F. Gygax

DOI: 10.1007/s11187-012-9442-z

Cite this article as:
Koropp, C., Grichnik, D. & Gygax, A.F. Small Bus Econ (2013) 41: 315. doi:10.1007/s11187-012-9442-z


Business succession is one of the primary management challenges for family firms. However, many family firms fail at this task because of financial issues. Although a vast number of studies have investigated the succession process, research thus far has failed to determine how and why family firms select particular forms of financing for succession-related expenditures. Accordingly, this study conceptually and empirically investigates succession financing. We introduce a conceptual framework that investigates the reasons behind an owner-manager’s intent to use debt for succession financing. Specifically, our model accounts for general and succession-related personal factors. However, we also include a set of firm-specific financing behavioral controls in our research. The empirical results are derived from a sample of 187 German family firms, and the results highlight financial knowledge, attitudes, succession experience, and succession planning as significant determinants of the owner-managers’ debt usage intentions. The implications and avenues for future research are discussed.


Family firmsSuccessionDecision makingDebt financing

JEL Classifications


Copyright information

© Springer Science+Business Media, LLC. 2012

Authors and Affiliations

  • Christian Koropp
    • 1
  • Dietmar Grichnik
    • 1
  • André F. Gygax
    • 2
  1. 1.Institute of Technology ManagementUniversity of St. GallenSt. GallenSwitzerland
  2. 2.Department of Finance, Faculty of Business & EconomicsUniversity of MelbourneVICAustralia