SMEs Shying Away from Venture Capital
SMALL firms in Northern Ireland's IT sector are reluctant to use venture capital funding, a University of Ulster report has found.
According to findings by UU researcher Rory McLaughlin, just 1 in 5 of firms reported that they'd financed business growth using this method.
Among other findings in the report, Financing Small High-Tech Firms in Northern Ireland: An Exploratory Study of Conservative Attitudes, were
l Seventy percent of small firms in the study reported dissatisfaction with the constraint imposed by traditional banking methods of business finance;
l SMES are wary of venture capital funding, with only 20 per cent of the study reporting that they'd used VC financing, while 45 per cent said they would not consider using VC funding; l 40 per cent of firms were 'happy' with the support they'd received from LEDU, the former small business agency, now absorbed into Invest Northern Ireland - but almost half (40 per cent) wanted a return to the former grant-based system. Only one firm in the study welcomed recent moves away from grants;
l 35 per cent of firms studied felt that business guidance from government agencies was "too general" and felt that what was needed was company or market-specific information. …