Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/58257
Authors: 
Brown, Martin
Degryse, Hans
Höwer, Daniel
Penas, María Fabiana
Year of Publication: 
2012
Series/Report no.: 
ZEW Discussion Papers 12-032
Abstract: 
Start-up firms often face difficulties in raising external funds. Employing a unique panel dataset covering 9,715 start-up firms over the period 2007-2009, we find that high-tech startups are less likely to use bank finance and face more difficulties in raising bank finance than low-tech start-ups. We find that external credit scores do affect the availability of credit for start-up firms, but that banks rely less on external rating information in their decision making for high-tech start-ups than low-tech start-ups. Start-ups that have their main relation with a small bank use more bank finance and report less difficulties in getting credit. By contrast, a greater expertise of the bank in the firm's industry is not associated with fewer difficulties to get bank loans. There are no differences between high-tech and low-tech start-ups regarding the impact of bank size.
Subjects: 
Innovation
Start-up
Credit information sharing
Soft information
JEL: 
G2
G18
O16
P34
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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