Understanding the aspirations of Finnish entrepreneurs and venture capitalists: Their effects on international operations and growth

Small firms must increasingly seek external funding to fuel their growth ambitions domestically and internationally. However, external funding comes with conditions and ownership claims signifying changes to the entrepreneur’s status quo. At the same time, the current climate for entrepreneurship and the availability of funding tend to fluctuate because potential funders contemplate the keenest investment strategy. In this study, we use a sample of 262 small internationally operating firms in Finland to investigate the impacts of entrepreneurs’ acceptance of venture capitalists (VCs) as new stakeholders in their firms and the approaches VCs take to entrepreneurship. Moreover, we study the effect of external funding on international operations, growth and financial performance of the firm. We found that the aspirations of entrepreneurs and VCs affect the firms’ use of external funding, and that this funding contributes to increased international operations, corporate growth and financial performance.