The relation between key events in the development phase and the financial structure of NTBFs in the software sector

Teresa Hogan, Elaine Hutson

Research output: Chapter in Book/Report/Conference proceedingConference contributionAcademic

Abstract

This paper finds no systematic relation between product lead time and acquisition of first external funds in new technology-based firms (NTBFs) in the software product sector. Contrary to the stage model’s predictions, these firms are just as likely to secure finance in advance of producing their first product beta as they are to receive funds subsequently. Product lead times in this sector are short. Firms produced their first product beta in a median of 12 months and acquire their first external funds a median 3 months later. The timing of these two events, however, is not significantly different. There is a significant difference in the mean time to receipt of consulting revenues and the development of first beta, suggesting that most software product companies use consulting revenues to fund product development.
Original languageEnglish
Title of host publicationProceedings of the 14th Annual High Technology Small Firms Conference and Doctoral Workshop 2006
EditorsGloria Rossini
Place of PublicationEnschede
PublisherUnivesity of Twente
Number of pages38
ISBN (Print)9789081078412
Publication statusPublished - 2006
Externally publishedYes
Event14th Annual High Technology Small Firms Conference, HTSF 2006 - University of Twente, Enschede, Netherlands
Duration: 11 May 200613 May 2006
Conference number: 14

Conference

Conference14th Annual High Technology Small Firms Conference, HTSF 2006
Abbreviated titleHTSF
CountryNetherlands
CityEnschede
Period11/05/0613/05/06

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