Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
}
TY - JOUR
T1 - Financing high-tech SMEs in China
T2 - a three-stage model of business development
AU - Xiao, Li
PY - 2011/4
Y1 - 2011/4
N2 - This article examines the financing of high-tech Small and Medium-sized Enterprises (SMEs) in China at different stages of business development, based on a survey of 74 face-to-face interviews with high-tech SMEs and additional nine informal face-to-face interviews with bank and government officials in the two Chinese provinces of Guangdong and Guangxi. Attention is focused on distinguishing different financing methods according to particular stages of an SME's business life cycle. The findings show the importance of informal financial sources from individuals and firms’ employees for high-tech SMEs at all three development stages. Such sources have become a central aspect of the financial infrastructure for the private sector in China. The article distinguishes between the alternative methods or practices used by firms at all three stages, seeking to either overcome particular financial constraints or to avoid the commitment of large capital investments in relatively long-term projects. It identifies the absence of demands and a gap for medium- and long-term funding for high-tech SMEs, placing a serious barrier on the ability of high-tech SMEs to engage in R&D for making more fundamental innovation and developing new/distinctive products. It concludes by making the implications of these findings for China, and internationally.
AB - This article examines the financing of high-tech Small and Medium-sized Enterprises (SMEs) in China at different stages of business development, based on a survey of 74 face-to-face interviews with high-tech SMEs and additional nine informal face-to-face interviews with bank and government officials in the two Chinese provinces of Guangdong and Guangxi. Attention is focused on distinguishing different financing methods according to particular stages of an SME's business life cycle. The findings show the importance of informal financial sources from individuals and firms’ employees for high-tech SMEs at all three development stages. Such sources have become a central aspect of the financial infrastructure for the private sector in China. The article distinguishes between the alternative methods or practices used by firms at all three stages, seeking to either overcome particular financial constraints or to avoid the commitment of large capital investments in relatively long-term projects. It identifies the absence of demands and a gap for medium- and long-term funding for high-tech SMEs, placing a serious barrier on the ability of high-tech SMEs to engage in R&D for making more fundamental innovation and developing new/distinctive products. It concludes by making the implications of these findings for China, and internationally.
KW - finance
KW - high-tech SMEs
KW - three stages of business development
KW - China
U2 - 10.1080/08985620903233937
DO - 10.1080/08985620903233937
M3 - Journal article
VL - 23
SP - 217
EP - 234
JO - Entrepreneurship and Regional Development
JF - Entrepreneurship and Regional Development
SN - 0898-5626
IS - 3-4
ER -