Resumo

DHLAMINI, Jabulani. Financing the growth of small to medium enterprises in emerging markets: The role of private capital. JCMAN [online]. 2024, vol.21, n.spe, pp.22-48. ISSN 1815-7440.  http://dx.doi.org/10.35683/jcman1030.239.

PURPOSE OF THE STUDY: The purpose of the study was to establish how funding from the three forms of private capital - namely, (i) angel investors, (ii) venture capital, and (iii) private equity - can support the growth of small to medium enterprises (SMEs) in emerging markets, based on insight from publications in the two decades from 2001 to 2020 DESIGN/METHODOLOGY/APPROACH: A systematic review of the existing literature on angel investors, venture capital, and private equity was conducted, and relevant publications from the period 2001 to 2020 were selected using a Scopus search. A total of 84 publications were identified, and these were filtered further, leaving 25 publications that were analysed using content analysis FINDINGS: The review established that SMEs faced numerous challenges in sourcing and accessing funding for their ventures and that this affected their growth and, to some extent, their survival. Private capital was shown to play a significant role in SME growth, and it goes beyond just providing finance but extends to the provision of other operational support services, and improvement of corporate governance, including engagements with governments to influence SME policy RECOMMENDATIONS/VALUE: The review contributes to the body of knowledge by providing (i) an understanding of SME financing challenges, (ii) insight into the role played by private capital to grow SMEs and to address their financing challenges, (iii) a theoretical framework on SME private capital financing that SMEs could use to identify suitable forms of financing; and (iv) a funding pitching guide MANAGERIAL IMPLICATIONS: The review provides insight for entrepreneurs and/or SME owners/managers into the types of private capital and the respective requirements to pitch for funding. The review also presents a theoretical framework on SME private capital financing that frames the sources of financing for the various growth stages that SMEs go through and a funding pitching guide JEL CLASSIFICATIONS: G23, G24

Palavras-chave : Angel investor; Emerging markets; Private equity; SME financing; Venture capital.

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