Crowdfunding, business angels, partnerships...there are many possibilities.

يتم تمويل الشركات الناشئة في هذه الحالة من خلال الأفراد أو حاضنات الأعمال أو المصارف الإسلامية...الخ

Equity.

microfinance programs.

Venture Finance in shape of equity with provision to allow participant Venture Fund exit route in future.

Sometimes, self-financing and eagerness is enough for an innovative startup. For me it was enough, Alhamdulillah.

Fatematuj Jahara ,I don't agree with you it takes more time . I think I know you personally by the way I can't remember

According to statistical data, on average 1 startup per 10 achieves spectacular success and develops dynamically for a minimum period of several years. 2-3 somehow manage, but without major successes, and the remaining 7 after a year or two years end their activities for various reasons. This statistic may differ slightly between regions and countries depending on external financing assistance programs, organizational support from business incubators, etc. However, a small part of opened startups has been functioning for more than 2 years and has achieved great success in the scope of offer development, business run, participation in the acquired markets, the sale of a specific offer of innovative products or services and achieves financial success, which provides development opportunities.

In view of the above, what are the key success factors for the development of innovative startups? Is the idea for an innovative product or service the most important? Is the innovative technology on the basis of which new products or services are manufactured? Are convenient sources of external financing? Is a well-connected team of founders of a startup? Is a convenient tax system supporting the development of small entrepreneurship and innovation? Are also other factors?

Are financial issues the main barrier to the development of innovative startups? Are limited sources of external financing and high fiscal costs the main barriers to the development of innovative startups? Are there other equally important barriers to development?

Please reply

I invite you to the discussion

Thank you very much

Best wishes

Venture Debt,

The choice of the source of finance will depend upon the available choices, size or amount of the requirement based upon the scale of the business and cost of that type of capital. A good mix of internal and external financing can do the wonders for the business. But, the problem is that a good idea may not find a good investor or financier and someone with large amount of idle funds may not have a good idea to work upon.

lack of financing from the banks has lead to change in sourcing for finances and innovators have resulted to blended finance , which is the new shift. banks has become more expensive and most innovation may not see the day even if they are financed. To sustain innovation practice blended finance gives solution

التمويل عن طريق حاضنات الأعمال

no external source of innovative startups. all the money is mine.

In view of the above, it is also important to include in the above discussion also the following issue:

What should be the economic policy for supporting the development of entrepreneurship and innovation? Should an active, Keynesian and interventionist policy be used to increase spending from the state budget on the development of entrepreneurship support programs and innovativeness of business entities? However, should neo-classical economics expenditures from the public finance system for programs supporting entrepreneurship and innovation of business entities be small, according to the concept in which the essence of entrepreneurship and innovation lies in its self-acting objective initiation, organization and development?

Please reply

I invite you to the discussion

Thank you very much

Best wishes

Dear Colleagues and Friends from RG,

In recent years, more and more often, innovative and technological startups have been using new forms of crowdfunding, equity, crowdfounding and other forms of financing available via the Internet for innovative investment projects with high investment risk. Due to the high level of investment risk and difficulties in assessing technological and product innovation etc., a significant number of banks avoid financing innovative, technological startups. Commercial lenders, including lending banks, usually do not provide 100% financing. capital necessary to implement a specific business venture, because in this financing formula the lender or lender bears the full and very high credit and / or investment risk. However, there are financial or para-financial institutions, loan funds, subsidies from state public funds, the so-called business angels that grant loans sometimes as much as 100% financing business ventures. This way, among other things, certain types of innovative, technological startups that have high development potential are financed. These types of financing for innovative, technological startups are burdened with a high level of investment risk that the investor accepts in full.

In the following years, the development of internet and financial innovations can be significantly determined by the use of blockchain technology in the field of improving data transfer security systems on the Internet. Blockchain technology can also be used to secure online settlements and social payments, including financing innovative projects, new ventures developed by technological startups, and financing the development of open innovations through e.g. crowdfunding. Perhaps in the online accounts will also be used in the future critical critics. Perhaps in the future cryptocurrencies will be displacing traditional currency from online financial transactions between fintechs, financial institutions, innovative startups, online technology companies operating social media portals and their clients, and between users of these portals. The development of all of the above-mentioned ICT information technologies, advanced data processing technologies Industry 4.0 and technologies facilitating financial operations on the Internet and ensuring a high level of security of internet data transfer. The development of technological innovations, ICT information technologies, advanced information processing technologies co-creating the current technological revolution Industry 4.0, financing through crowdfunding, securing online transactions with blockchain technology, increasing the use of cryptocurrencies in these settlements, etc. These can be important determinants of the development of innovative, technological startups operating on the Internet and factors of development of the knowledge-based economy in subsequent years.

Some technology companies operating in the field of ICT and new online media are also planning to develop blockchain technology in cryptocurrency applications. For example, the social media Facebook site also announced the creation of its own critical currency called Libra, which users of the portal will be able to pay for various services available through Facebook. Some investment funds invest their financial capital in some cryptocurrencies. Another issue determining the development of open innovations that are used on the Internet are technologies typical of the current technological revolution, Industry 4.0. The current technological revolution referred to as Industry 4.0 is determined by the development of the following advanced information processing technologies, which include, among others: Big Data database technologies, cloud computing, machine learning, Internet of Things, artificial intelligence, Business Intelligence and other advanced data processing technologies Data Mining. The technologies of advanced information processing listed above are finding more and more applications in various fields of industry, production of goods and provision of services. The number of industries, branches of economic activity and sectors of the national economy is growing, in which advanced information processing technologies typical of the current fourth technological revolution known as Industry 4.0 are used. ICT information technologies and advanced information processing technologies co-creating the current technological revolution Industry 4.0 have in recent years been a key factor in the emergence of new technological innovations and other applications applicable in various branches of the national economy. These innovations are becoming the main factor in the development of innovative startups and technology companies operating on the Internet. In macroeconomic terms, on the other hand, these technological and other innovations are an important factor in the development of modern knowledge-based economies and may have a significant impact on the economic growth rate of a developed and developing economy. I described these issues in my publications, which are available on the Research Gate portal. I invite you to scientific cooperation.

In my opinion, startups developing innovative business ventures based on innovative technologies or innovative products, services, innovative logistics, etc. are financed through crowdfounding and other forms of social external financing of investment projects available on the Internet. For this type of investment projects it is difficult to obtain financing from banks in the form of traditional loan, credit and para-credit instruments. Most banks have not yet developed multifactorial models of analysis and precise measurement of credit risk for this type of innovative investment projects planned for implementation by startups characterized by a high level of innovation, low fixed capital and a short history of functioning on the markets.

Often, emerging startups develop innovative technologies and / or products, services offered, etc. Then there is the risk of innovation. Due to the high level of risk, it is difficult for startups to find banks that would be willing to credit the implementation of a planned innovative business venture. Specialized investment funds deal with external financing of innovative startups. In addition, more and more often, innovative, technological startups use new forms of crowdfunding, equity, crowdfounding and other forms of financing available via the Internet for innovative investment projects with high investment risk. Investment funds financing the development of innovative startups implement an investment policy taking into account the bankruptcy statistics of newly established startups. Well, they choose startups with high business growth potential and high prognosis for successful implementation of an innovative business venture. For example, they choose 10 startups to finance their development, assuming that at least half of these 10 startups will fail within 2 years of their creation, 2 or 3 startups will survive this period and will operate for at least several years but with poor business results and only 1 startup will achieve great success, high level of growth and after a few years the investment fund will be able to sell shares in this startup with high profit. In connection with the above, the key issue is to improve models for estimating the risk of bankruptcy of newly created startups and to develop the state's economic policy supporting the development of innovation, including creating conditions for the development of innovative startups. This is particularly important in knowledge-based economies where innovation and entrepreneurship are an important production factor.

Do you agree with me on the above matter?

In view of the above, I am asking you the following questions:

- Will crowdfunding on the internet, including crowdfounding, be the dominant form of external financing for innovative, technological startups?

- Will the importance of cryptocurrencies grow in terms of external financing of innovative, technological startups?

What do you think about this topic?

What is your opinion on this topic?

Please reply

I invite you to the discussion

Thank you very much

Best wishes

Dariusz Prokopowicz

Well...

In some countries such as Japan for example, prior to initiating existence, start ups perform evidence-based and word-of-mouth research on the market demand for a product they might be interested in developing.

Once such a need is ascertained, future start up co-founders make an "alpha" version of the product and engage in a series of presentations with mid- and high-level management of companies that might be interested in co-investing/ selling the product - i.e....

Japanese start ups try to carve up a niche on the market by being the first new-comer in a product segment, rather than competing with already existing products/ companies.

Apparently, these tactics minimize the chance for failure in the first year of start-ups' existence.

:)

Thank you for your answer. Your opinions confirm the theses formulated above. Joint discussions are very encouraging, new concepts are created, ideas are exchanged and different approaches to specific issues are created. Joint discussions significantly contribute to the improvement of the developed concepts of scientific research, new theses, new formulas and directions of new research works.

I would like to add the following question to this discussion: In the context of the above issues, the following research question arises: Do innovative startups use new sources of financing available on the Internet more often than other economic entities? (e.g. from online social sources of financing, crowdfounding, investment funds created on drop-off websites, provided financing referring to the equity formula, etc.)?

What do you think about this topic? Regards, have a nice day,

Dariusz Prokopowicz

https://pdf.sciencedirectassets.com/277811/1-s2.0-S1877042815X00188/1-s2.0-S1877042815031651/main.pdf?X-Amz-Security-Token=IQoJb3JpZ2luX2VjEAoaCXVzLWVhc3QtMSJGMEQCIC56sA7%2BPcR7fIAdspQKBi4I1c9GpI0kfmdoAsc%2FvXYOAiANiPEB13JE1KJF11fVma%2B3vT5Qo4IMy0C0%2BUnKZLqUViq9AwjD%2F%2F%2F%2F%2F%2F%2F%2F%2F%2F8BEAMaDDA1OTAwMzU0Njg2NSIMSkkS9vOF6Q6DcpWwKpEDeL9yB41mY0yYIS9jr1KXlYHpc01FzKhJeQXT6B4Vr0qKoeo1iTMCaFE04fMg7w%2BG6xGo5TJTlI60oL4GQIveUhlSvBjN95EI0O2qq%2FyMbrlj%2FS%2F8zYC4YM3xAWtaZz4Pkr5AU3gqsxjxjhP%2Bz4WuOmpWJGsXQFFJUk2B0V%2FktPAQ4zBR1HnE9WMyZBeJotghIjdkzqZpy9bU0K9A4EXPWGq5FTpokC3akao1YkGfLygPcfVtg3ySlopLEIGS5H%2BK1iJEc8VhSVLy4nficF4kKSJCuEskL%2BoOZLf5V8rkZx%2BC0%2B9AEfLFGAjvhfWV%2F6cFDqCbOKCCPBWfBDHYEsYziksClY%2FIX9udaO0Ish2lA2a7ew0E7AE%2F4Qt2wt3fw1H9rK2NiUznu4Zk08aT1Q7K52GF7bMrUhYY8Eiwnz0WbIFeqaFrXfKGrGfCtxezP0%2FKyN9p%2B1%2FiOxxs0lw57KZ5%2B%2FK1mmRuPFWGOGvN%2FETZEm6gt3YpFJ81SVvpzJUQoxa0PQoJsL%2F9jUP8QjR9CO78Pqow6f32%2BAU67AGuHDs4bfnH1bcmJF159nwFZAqra1OZviIpvLwIoNn7yphsT69SmYOrE9GiNjEo26z1xKBg%2BMbr9e1siAy%2B2kQH2yDH9m6hk%2FfpcpRApOQp6pc3p6M7HKlnznkYYSw1qjcY%2B2nUZTohIl7GqJXRNcNghst5wurP6uBebmt%2Bew%2FPLdef25E%2FApc%2Ft5Fn%2BbA5OLjOZgvEn9F3VpKC8ran42CTtT%2BIzbCY6tdQBScDQGo1GM5Mv8za%2BA76J615shYh0XPVYX2dX4z5LjYkf4c6QlvaY%2FaEwJUwgd4BZu2MHNkkoXPBUE8V62Duo5SxvA%3D%3D&X-Amz-Algorithm=AWS4-HMAC-SHA256&X-Amz-Date=20200726T180958Z&X-Amz-SignedHeaders=host&X-Amz-Expires=299&X-Amz-Credential=ASIAQ3PHCVTY2LTDNJVG%2F20200726%2Fus-east-1%2Fs3%2Faws4_request&X-Amz-Signature=ff837bb68d7980c556ad3cccb1721779c1e2c79afd9937ca5e6c0aa6d9d35ee5&hash=d4dc8c822ff81c1f5cb2141ad7397ebab6f91af02374c54a3fd44bc9c87d57df&host=68042c943591013ac2b2430a89b270f6af2c76d8dfd086a07176afe7c76c2c61&pii=S1877042815031651&tid=spdf-9dd91075-84b9-4c2c-a0ab-5e692f7d99ac&sid=14b6bb6e1bd2c1479248f5a74575474d4489gxrqb&type=client

Dear Sule Akkoyunlu,

Thank you for the information provided and the link to interesting data in the above-mentioned issues. Best regards,

Dariusz Prokopowicz

Crowdfunding, business angels, partnerships...there are many possibilities.

Dear Mirna Leko-Šimić, Thank you very much for your response.

Yes, innovative startups use various non-bank forms of external financing.

Best regards,

Dariusz Prokopowicz