Entrepreneurial Orientation and Start-ups’ External Financing

This study tries to understand the role of new firms’ strategic posture for their financial decision making, by proposing that new firms’ entrepreneurial orientation partially explains their external financing decisions. Empirical analysis of 4,404 German start-ups reveals a strong relationship between entrepreneurial orientation and financing structure, and shows its dependency on industry-specific risk and venture development stage. This study advances the literature on entrepreneurial finance by exploring the financing decisions of new ventures from a strategy perspective. It also provides valuable practical implications for start-up founders and external financing providers.