Title: The impact of the financial crisis on financing technology ventures

Authors: Ann-Kristin Achleitner; Reiner Braun; Georg Metzger; Maximilian Schmidt

Addresses: Center for Entrepreneurial and Financial Studies Technische Universität München, Arcisstrasse 21, D-80333 Munich, Germany ' Center for Entrepreneurial and Financial Studies Technische Universität München, Arcisstrasse 21, D-80333 Munich, Germany ' KfW Bankengruppe, Palmengartenstr. 5-9, D-60325 Frankfurt a. M., Germany ' Center for Entrepreneurial and Financial Studies Technische Universität München, Arcisstrasse 21, D-80333 Munich, Germany

Abstract: This study examines the impact of the financial crisis on technology venture financing and investment activity. Multivariate analyses on a sample of 1,916 German technology ventures from 2007 to 2011 show that the total financing volume dropped during the financial crisis. This drop was driven by a decrease in internal and external funding. As one consequence, technology ventures, especially those with strong growth potential, reduced their investment activities in long-term tangible and intangible assets. The practical implications are worrisome, since the future prospects and growth rates of these technology ventures are likely to be affected.

Keywords: start-up financing; entrepreneurial finance; financial crisis; technology ventures; investment activity; Germany; start-ups; internal funding; external funding; long-term assets; tangible assets; intangible assets; growth rates; firm growth.

DOI: 10.1504/IJESB.2016.078051

International Journal of Entrepreneurship and Small Business, 2016 Vol.29 No.1, pp.4 - 24

Received: 06 Jun 2014
Accepted: 03 Aug 2015
Published online: 31 Jul 2016 *

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