A Global Research Perspective
New Horizons in Entrepreneurship series
Edited by Candida G. Brush, Nancy M. Carter, Elizabeth J. Gatewood, Patricia G. Greene and Myra M. Hart
Chapter 16: Gender, Entrepreneurship and Business Finance: Investigating the Relationship between Banks and Entrepreneurs in the UK
Sara Carter, Eleanor Shaw, Fiona Wilson and Wing Lam* INTRODUCTION An individual’s ability to engage in entrepreneurship is predicated on the availability of resources, in particular access to finance. Research that has investigated entrepreneurial finance in the form of equity capital has focused mainly on the supply side (Mason and Harrison, 1999), where the perspective of the venture capitalist or venture capital industry is the central concern (Sapienza, 1992; Wright et al., 1997; Zacharakis and Shepherd, 2001). The demand-side perspective, focusing on the approaches taken by firms seeking external investment, has attracted less research interest, although some researchers have explicitly commented on the need to focus on variations in the ability of some entrepreneurial groups to obtain venture finance (Timmons and Sapienza, 1992; Timmons and Bygrave, 1997). Women are one of the main entrepreneurial groups that have, so far, notably failed to obtain their share of venture finance. Current estimates suggest that in the USA, less than 5 per cent of the $73 billion venture capital pool is awarded to women-owned firms (Greene et al., 1999; Business Week Online, 2001). Greene et al. (1999) suggested three reasons why women experience difficulties in raising equity capital: firstly, women choose not to seek this type of external investment; secondly, women encounter structural barriers that preclude their access to equity capital; and thirdly, women lack the knowledge and capabilities to obtain equity capital. In addition, it has also been argued that women choose to start their businesses in sectors or locations that do...
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