This study investigates the initial capitalization and financing patterns of recently established (new) and established (old) small businesses in Iowa. Analysis of survey responses indicates that significant differences exist between these two groups of firms. Specifically, new firms are found to have relied more heavily on debt financing than old firms. This suggests that new firms with high debt loads are likely not to survive and become old firms.
This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Van Auken et al
Howard E. Van Auken and B. Michael Doran. "Small Business Capitalization Patterns" Journal of Applied Business Research
Vol. 5 Iss. 2 (1989) p. 15 - 22
Available at: http://works.bepress.com/howard-vanauken/13/