The Use of Signals in New-Venture Financing: A Review and Research Agenda

By Oskar Colombo. 2021

261 citations recorded by the source corpus.

The use of signals to overcome information asymmetries and reduce the uncertainty inherent in resource acquisition has become a prominent theme in new-venture financing literature. In particular, the assessment of a wide range of different information signals, with the aim of conveying a venture’s quality and legitimacy to prospective investors, is receiving increased scholarly attention. With contributions from a broad spectrum of diverse research foci investigating interactions with distinct types of investors, the literature on entrepreneurial signaling in new-venture financing has become fragmented, and this is harming further development of the field. This study systematically reviews the different literature streams on entrepreneurial signaling to provide a more integrative framework, which can contribute to the cumulative and evidence-based body of knowledge about the role of entrepreneurial signaling in new-venture financing. Furthermore, the authors identify critical sender-, signal-, receiver-, and environment-related boundary conditions that influence the signaling effectiveness. In this way, the authors identify gaps in the existing literature and map directions for future research.

Subfields: Accounting, Management Information Systems, Management of Technology and Innovation

View Paper: https://www.semanticscholar.org/paper/111336076f6fb0d034c3c32622428ef66469f362

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. Shuangfa Huang
2. Thang Nguyen
3. David Pickernell
4. Martina Battisti

In Management Information Systems

1. Shuangfa Huang
2. Thang Nguyen
3. David Pickernell
4. Martina Battisti

In Management of Technology and Innovation

1. Shuangfa Huang
2. Thang Nguyen
3. David Pickernell
4. Martina Battisti

Citations in the corpus

• Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments (2021, background): “This finding addresses recent calls to integrate positive and negative signals in crowdfunding studies to advance our understanding of how signal incongruence can enhance crowdfunding success (Colombo, 2020; Drover et al., 2018).”