@article{eed9cf837567435d9ff1e75f471eefd8,
title = "Managing risk in the formative years: Evidence from young enterprises in Europe",
abstract = "This paper empirically investigates aspects of risk management in young small enterprises effort to survive and grow. We use a new dataset on several thousands small businesses in their {"}formative age{"} (2-8 years old) in 10 European countries and 18 sectors. Firms across all types of sectors use internal risk mitigation strategies to manage technology risk and operational risk. Financial risk is managed by tapping formal and informal networks. Market risk appears less amenable to internal management action. Formal network participation (strategic alliances) is a strategy cutting across all kinds of risk with the exception of operational risk. Firms in knowledge-intensive sectors (high-tech manufacturing and KIBS) engage in risk management activities more extensively. Firms led by more educated entrepreneurs and/or operating in demanding volatile markets tend to network more and to use internal risk mitigation strategies more extensively.",
keywords = "Risk, Risk management, SMEs, Small firms",
author = "Youngjun Kim and Vonortas, {Nicholas S.}",
note = "Funding Information: The data used in this paper comes from the European AEGIS survey – produced in the context of the multi-national research project “Advancing Knowledge-Intensive Entrepreneurship and Innovation for Economic Growth and Social Wellbeing in Europe with financial support by the 7th Framework Programme of the European Commission. The survey was launched in an attempt to identify motives, characteristics and patterns in the creation and growth of young – but not brand new – firms which are based on the intensive use of knowledge and operate in both knowledge-intensive and low tech sectors. It was carried out during Fall 2010 and Spring 2011. The survey recovered 4004 fully completed questionnaires (about 300 variables) from an equal number of independent enterprises established during the period 2002–2008 in 10 European countries (Croatia, Czech Republic, Denmark, France, Germany, Greece, Italy, Portugal, Sweden, and the United Kingdom) ( Table 1 ). This sample did not include subsidiaries of existing companies, mergers/acquisitions, joint ventures, or new entities resulting from any type of legal transformation of already existing firms. At the time of the survey, these enterprises were 2–8 years old and were distributed as follows: 2-year old, 431 firms; 3-year old, 759 firms; 4-year old, 409 firms; 5-year old, 462 firms; 6-year old, 464 firms; 7-year old, 149 firms; 8-year old, 950 firms. Both manufacturing sectors and service sectors were covered. Manufacturing included high tech, medium, and low tech sectors. In addition, four knowledge intensive business service sectors (KIBS) were included ( Table 2 ). Copyright: Copyright 2014 Elsevier B.V., All rights reserved.",
year = "2014",
month = aug,
doi = "10.1016/j.technovation.2014.05.004",
language = "English",
volume = "34",
pages = "454--465",
journal = "Technovation",
issn = "0166-4972",
publisher = "Elsevier Limited",
number = "8",
}
