Journal
УКР   ENG
Socio-Economic Problems
of the Modern Period of Ukraine
   



Collection SEPSPU -- sep2021.05.029

Repository of Institute of Regional Research UDC [334+336]:330.4; JEL B26, C30, D22, H50, H60
Zhyber, T. V., Lihonenko, L. O., Piskunova, O. V., Srivastava, P., & Huzik, T. A. (2021). Lohit-model' dlya prohnozuvannya venchurnoho finansuvannya startapiv [Logit-model for predicting startup’s venture funding]. In Sotsial'no-ekonomichni problemy suchasnoho periodu Ukrayiny [Socio-Economic Problems of the Modern Period of Ukraine]: Vol. 151 (5) (pp. 29-36). DOI: https://doi.org/10.36818/2071-4653-2021-5-4. [in Ukrainian].
Sources: 20

Authors



Zhyber Tetyana Vasylivna

Ph.D. of Economics, Associate Professor

Associate Professor of the Department of finance of the Faculty of Finance of the Kyiv National Economic University n.a. Vadym Hetman

Contacts: tzhyber@kneu.edu.ua

Webpages:



Lihonenko Larysa Oleksandrivna

Doctor of Economics, Professor

Professor of the Department of business economics and entrepreneurship of the Faculty of economics and management of the Kyiv National Economic University n.a. Vadym Hetman

Contacts: larisa.ligonenko@gmail.com

Webpages:



Piskunova Olena Valeriyivna

Doctor of Economics, Professor

Associate Professor of the Department of mathematical modeling and statistics of the Institute of information technology in economics of the Kyiv National Economic University n.a. Vadym Hetman

Contacts: episkunova@kneu.edu.ua

Webpages:



Srivastava Pankaj

Ph.D. of Physics and Mathematics

Professor of the Department of mathematics of the Motilal Nehru National Institute of Technology Allahabad

Contacts: drpankaj23@gmail.com

Webpages:



Huzik Tetyana Anatoliyivna

Ph.D. of Pedagogy, Associate Professor

Head of the Department of foreign languages of the Faculty of Finance of the Kyiv National Economic University n.a. Vadym Hetman

Contacts: tetiana.guzik@gmail.com

Webpages:

Resume

The paper is devoted to deepening the academic basics using forecasting modeling methods to determine the predictors of enterprises’ success. A startup as a form of entrepreneurship is important today due to the ability to maintain the sustainability of the economic system through a flexible response to challenges. The startup’s potential for receiving external, direct venture financing from other economic counterparties is important forits sustainable development and success. The empirical study puts forward two hypotheses. The first one is that successful startups have common features, which are the factors in obtaining venture financing, i.e. predictors of success. The second hypothesis is a continuation of the first one and requires testing the importance of information representation and clarity of future startup results among venture investors, in particular through the information available about the startup’s activity over the Internet. The empirical study is based on data sets about startups in Ukraine over the last decade. The simulation is performed with logit models developed by the authors. The calculation allows us to confirm the identification of factors of direct influence on the startup’s success according to the built models. The ability to obtain venture capital is one of the startup’s characteristics. The logit model is used as the research tool to determine the relevant factors for defining the positive decision of venture investors to provide startup funding. Predictors of obtaining external funding are identified and considered as the prerequisites for the startup’s success in general. According to the research results,the presence of previous investors, the startup’s profit orientation, the startup’s website, and availability of information about its activity in the social network are the important factors for receiving external financing by a startup. Thepaper argues that the startup’s focus on the public good without profit orientation does not stimulate venture investors. Two periods of the startup founding are singled out among the influence signs in deciding whether a startup will receive external financing: before 2014 and after it. The recognizability of a startup became the determining factor for venture financing after 2014 due to the information provided through the Internet. Until 2014, the relationship with large corporations’ clients had been the most important feature for a startup with external venture financing.

Keywords:

venture financing, logit model, predictors, public goods, business management

References

    
  1. de Faria, V. F., Santos, V. P., & Zaidan, F. H. (2021). The Business Model Innovation and Lean Startup Process Supporting Startup Sustainability. Procedia Computer Science, 181, 93-101. DOI: https://doi.org/10.1016/j.procs.2021.01.106
  2. McGrath, R. G. (2010). Business models: A discovery driven approach. Long range planning, 43(2-3), 247-261. DOI: https://doi.org/110.1016/j.lrp.2009.07.005
  3. Jesemann, I. (2020). Support of startup innovation towards development of new industries. Procedia Cirp, 88, 3-8. DOI: https://doi.org/10.1016/j.procir.2020.05.001
  4. Gupta, V., Fernandez-Crehuet, J. M., Gupta, C., & Hanne, T. (2020). Freelancing models for fostering innovation and problem solving in software startups: An empirical comparative study. Sustainability, 12(23). DOI: https://doi.org/10.3390/su122310106
  5. Felin, T., Gambardella, A., Stern, S., & Zenger, T. (2019). Lean startup and the business model: Experimentation revisited. Long Range Planning, 54(3). DOI: https://doi.org/10.1016/j.lrp.2019.06.002
  6. Rammer, C., & Schubert, T. (2018). Concentration on the few: mechanisms behind a falling share of innovative firms in Germany. Research Policy, 47(2), 379-389. DOI: https://doi.org/10.1016/j.respol.2017.12.002
  7. Cotei, C., & Farhat, J. (2017). The evolution of financing structure in US startups. The Journal of Entrepreneurial Finance, 19(1), 1-32. Retrieved from http://hdl.handle.net/10419/197538
  8. Mayer-Haug, K., Read, S., Brinckmann, J., Dew, N., & Grichnik, D. (2013). Entrepreneurial talent and venture performance: A meta-analytic investigation of SMEs. Research Policy, 42(6-7), 1251-1273. DOI: https://doi.org/10.1016/j.respol.2013.03.001
  9. Roche, M. P., Conti, A., & Rothaermel, F. T. (2020). Different founders, different venture outcomes: A comparative analysis of academic and non-academic startups. Research Policy, 49(10). DOI: https://doi.org/10.1016/j.respol.2020.104062
  10. Ko, C. R., & An, J. I. (2019). Success factors of student startups in Korea: from employment measures to market success. Asian Journal of Innovation and Policy, 8(1), 97-121. DOI: https://dx.doi.org/10.7545/ajip.2019.8.1.097
  11. Pampel, F. (2000). Logistic Regression: A Primer. London: Sage University Pagers Series.
  12. Efron, B. (1975). The efficiency of logistic regression compared to normal discriminant analysis. Journal of the American Statistical Association, 70, 892-898.
  13. Spicer, J. (2004). Making Sense of Multivariate Data Analysis. Beverly Hills, CA, and London: SAGE Publications Ltd.
  14. Gichan, O., & Gospodarik, Ye. (2020). Sovremennaya praktika razrabotki skoringovykh kart dlya roznichnykh kliyentov v belorusskikh bankakh [Modern practice of developing scoring cards for retail clients in Belarusian banks]. Bankaŭski viesnik – Banking Bulletin, 4(681), 49-59. [in Russian].
  15. Nassimbeni, G. (2001). Technology, innovation capacity, and the export attitude of small manufacturing firms: a logit/tobit model. Research Policy, 30(2), 245-262. DOI: https://dx.doi.org/10.1016/S0048-7333(99)00114-6
  16. Lee, T. R., Chang, T. F., & Hilletofth, P. (2014). Using binary logit model to develop the target consumer’s differentiation standards for the marketing activities in tea retailers’ sales observation method. International journal of innovation and learning, 15(4), 432-446.
  17. Skrzypek, K., Dąbrowski, K., Wojciech, M., & Kłos, S. (2017) Binomial logit models in the assessment of the manufacturing enterprise innovativeness. In Vision 2020: Sustainable Economic development, Innovation Management, and Global Growth: Proceedings of the 30th International Business Information Management Association Conference, IBIMA 2017 (pp. 585-589).
  18. Startup Ranking: Website (2021). Retrieved from https://www.startupranking.com
  19. Ligonenko, L. O., Borysov, Ye. M., Hromozdova, L. V., Deineha, I. I., Leontovych, S. P., Kosiak, I. V., & Marco, Ye. I. (2021). Defining the Socio-Demographic Predictors of Priority Investment in the Context of Tasks for the Financial Subsystem of Startup-Management. Eastern-European Journal of Enterprise Technologies, 1/13(109), 15-25. DOI: https://doi.org/10.15587/1729-4061.2021.225639
  20. Yeliseyeva, I. I. (2005). Ekonometrika [Econometrics]. Moscow: Finance and Statistics. [in Russian].


Web-master P. Popadyuk