Sources Of Finance For The Entrepreneurial Firms

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This article gives an overview of the entrepreneurial finance literature. The studies reviewed highlight the sources of finance for the entrepreneurial firms. One of the basic difficulties in starting and growing a business is getting the initial capital to start up a business. Same is the case in order to grow the business further. To obtain initial financing, the entrepreneur has to think about the source of funds along with the type provided. The initial source of funds almost always comes from individuals-family and friends or private individual investors often called angels. These sources provide over 80% of the funds for startups in almost every country and are the key to bringing innovation to the market (Gary Gibbons, Robert D. Hisrich, Carlos M. DaSilva. 2015). The study indicates that the most common sources of entrepreneurial finance are angel investors, venture capital funds, corporate investors and financial bootstrapping.


The life of an entrepreneur is exciting and dynamic. The challenge of envisioning a new product or service and bringing a product to market can be one of the great learning experiences in life. All ventures require financing- taking investors’ money today and expecting to return a significantly larger amount in the future (J. Leach, Ronald Melicher. 2012). An entrepreneur has to find investors like a bank, his employer, a business angel, a venture capital fund or any other source of financing to start up a

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