Small Business Economics

, Volume 14, Issue 1, pp 37–53 | Cite as

The Provision of Finance to Innovation: A Survey Conducted among Italian Technology-based Small Firms

  • Giancarlo Giudici
  • Stefano Paleari


Financial constraints to the development of innovation are often considered one of the main impediments to high-technology firms seeking to expand and grow. In particular this is the case of small and medium size high-tech firms. In the U.S. and the U.K. a variety of sources of finance are available to the start-ups of innovative firms; in the other European countries, and particularly in Italy, these means are still uncommon so that the development of technology is often prevented. This paper, based on an empirical analysis on a survey of 46 small high-tech Italian firms, aims at exploring the problems experienced by small businesses in gaining access to debt and equity finance. The results highlight that traditional financial sources are inadequate to finance innovative projects. The questioned firms rely mainly on personal finance, and secondly on short term bank debt; they are truly involved in maintaining control over the firm activities and are willing to issue outside equity only if the new investors also provide non financial competencies. Among the 46 interviewed firms, only 10 are willing to be listed in the future on small firms' stock markets.


Stock Market Small Business Small Firm Financial Constraint Innovative Firm 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Kluwer Academic Publishers 2000

Authors and Affiliations

  • Giancarlo Giudici
    • 1
  • Stefano Paleari
    • 2
  1. 1.Università degli Studi di BergamoDalmine (BG)Italy
  2. 2.Dipartimento di Economia e ProduzionePolitecnico di MilanoMilanoItaly

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