DOI: https://doi.org/10.18371/fcaptp.v4i31.190825

MEANS OF PRIVATE INVESTMENT OF SMALL AND MEDIUM INNOVATION ENTREPRENEURSHIP IN THE EUROPEAN UNION

Yu. M. Zhornokui, I. M. Vahanova, O. V. Soboliev, I. V. Borysov

Abstract


The authors of the article have analyzed certain economic characteristics of private investment of small and medium-sized innovative enterprises in the European Union (hereinafter — the EU). It has been noted that, unlike public funding from the EU Member States and Structural Funds investment, it is appropriate to pay attention to the investment mechanisms used in the private sector to support small and medium-sized innovative entrepreneurship in the EU, which has its own specificity and sources. The features of such sources as bank lending, corporate and venture investing, as well as financing provided by business angels have been studied. It has been noted that bank loans for innovative enterprises in the EU have become more accessible, but the collateral requirements imposed by banks remain high. The reasons for the low level of corporate investment of innovative small and medium-sized enterprises (hereinafter — SMSEs) in some Member States are the lack of a developed culture of partial investment and the specificity of information exchange between companies and investors. The level of venture capital usage is low and, as a consequence, only a small number of SMSEs are attractive to venture capitalists’ investments. On the other hand, business angels are quite selective about investment objects. This determines their main activity at the stage of initial implementation of innovative projects.

It has been concluded that a large proportion of SMEs face serious problems in accessing investment resources, and there are significant differences between countries, directly, in such areas as debt financing and, therefore, SMEs’ financing in Europe. is not homogeneous. Despite the large number of support instruments for investing such enterprises in the EU, successful implementation of initiatives does not occur in all countries and has a heterogeneous effect. In order to create a successful EU policy on supporting SMEs there is the need in more in-depth understanding of the problems and specificities of financing SMEs of the EU Member States.


Keywords


an enterprise; innovations; venture entrepreneurship; bank financing; business angels; start-up.

Full Text:

PDF

References


Kabinet Ministriv Ukrainy. (2019). Stratehiia rozvytku sfery innovatsiinoi diialnosti na period do 2030: Rozporiadzhennia vid 10 lypnia 2019 r. № 526-r [Strategy for development of the sphere of innovative activity for the period till 2030: Order of July 10, 2019]. Retrieved from https://zakon.rada.gov.ua/laws/show/526-2019-%D1%80 [in Ukrainian].

Small and medium-sized enterprises’ access to finance. European Semester Thematic Factsheet. (2017, November 22). Retrieved from https://ec.europa.eu/info/sites/info/files/file_import/european-semester_thematic-factsheet_small-medium-enterprises-access-finance_en.pdf.

Annual report on the European small and medium-sized enterprises for 2018 (n. d.). Retrieved from https://ec.europa.eu/growth/smes/business-friendly-environment/performance-review_en.

Stabinskajte, Yu. A. (2016). Problemy i instrumenty finansirovaniya innovacionnoj deyatel'nosti predpriyatij Evropejskogo Soyuza [Problems and instruments for financing innovative activities of enterprises of the European Union]. Vestnik universiteta — University Bulletin, 11, 185—190 [in Russian].

Dickins, D., & Fril, M. (2014). Predprinimatel'stvo i malye formy [Entrepreneurship and small forms]. Kharkiv: Gumanitarnyj centr [in Russian].

Shotik, T. M. (2008). Venchurne pidpryiemnytstvo yak skladova innovatsiinoi infrastruktury [Venture entrepreneurship as a component of innovative infrastructure]. Visnyk Natsionalnoho universytetu «Lvivska politekhnika» — Bulletin of the National University «Lviv Polytechnic», 633, 805—814 [in Ukrainian].

Mason, C., & Harrison, R. (1999). Venture Capital: Rationale, Aims and Scope. Venture Capital, Vol. 1, 1, 1—46.

Amir, R., Brander, J., & Zott, C. (1998). Why do Venture Capital Firms Exist?. Theory and Canadian Evidence of Business Venturing, Vol. 13, 441—466.

EBAN. (2016, May). European Early Stage Market Statistics 2015. Retrieved from http://www.eban.org/wp-content/uploads/2016/06/Early-Stage-Market-Statistics-2015.pdf.

Birley, S., & Muzyka, D. (2000). Mastering Entrepreneurship: your single source guide to becoming a master of entrepreneurship. London : Financial Times / Prentice Hall.


GOST Style Citations


Стратегія розвитку сфери інноваційної діяльності на період до 2030 : Розпорядження Кабінету Міністрів України від 10 липня 2019 р. № 526-р. [Електронний ресурс]. — Режим доступу : https://zakon.rada.gov.ua/laws/show/526-2019-%D1%80.Small and medium-sized enterprises’ access to finance [Electronic resource] // European Semester Thematic Factsheet. — 2017. — November 22. — Available at : https://ec.europa.eu/info/sites/info/files/file_import/european-semester_thematic-factsheet_small-medium-enterprises-access-finance_en.pdf.Annual report on the European small and medium-sized enterprises for 2018 [Electronic resource]. — Available at : https://ec.europa.eu/growth/smes/business-friendly-environment/performance-review_en.Стабинскайте Ю. A. Проблемы и инструменты финансирования инновационной деятельности предприятий Европейского Союза / Ю. A. Стабинскайте // Вестник университета. — 2016. — № 6. — С. 185—190.

Дикинс Д. Предпринимательство и малые формы / Д. Дикинс, M. Фрил. — Харьков : Гуманитарный центр, 2014. — 448 с.

Шотік Т. М. Венчурне підприємництво як складова інноваційної інфраструктури / Т. М. Шотік // Вісник Національного університету «Львівська політехніка». — 2008. — № 633. — P. 805—814.

Mason C. Venture Capital: Rationale, Aims and Scope / C. Mason, R. Harrison // Venture Capital. — 1999. — Vol. 1. — № 1. — Р. 1—46.

Amir R. Why do Venture Capital Firms Exist? / R. Amir, J. Brander, C. Zott // Theory and Canadian Evidence of Business Venturing. — 1998. — Vol. 13. — P. 441—466.

European Early Stage Market Statistics 2015 [Electronic resource] // EBAN. — 2016. — May. — Available at http://www.eban.org/wp-content/uploads/2016/06/Early-Stage-Market-Statistics-2015.pdf.Birley S. Mastering Entrepreneurship: your single source guide to becoming a master of entrepreneurship / S. Birley, D. Muzyka. — London : Financial Times / Prentice Hall, 2000. — 432 p.




Copyright (c) 2020 Yu. M. Zhornokui, I. M. Vahanova, O. V. Soboliev, I. V. Borysov

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

ISSN (print) 2306-4994, ISSN (on-line) 2310-8770