George H. Haines

The Role of Angels in Technology SMEs: A Link to Venture Capital

The presence of angels among early-stage financiers of new technology-based firms should improve chances of eventual venture capital financing. Reasons to expect that firms with private investment would have easier access to venture capital are discussed. This study presents findings that support this expectation. A total of 57% of the firms that had received private investor financing had also received financing from institutional venture capitalists; only 10% of firms that had not received angel financing obtained venture capital. Angel investor financing was a significant explanatory variable (among others) of differences between venture capital recipients and firms that had not received venture capital. It would appear that angels help firms to become more ready for future stages of investment by, among other contributions, being closely involved with the firms in which they invest. They usually provide advice and networking opportunities. They also serve on Boards of Directors and Advisors, and provide hands-on assistance and business intelligence. Angels also fulfill an important accreditation role. Overall, this study provides empirical support for the expectation that involvement of angels can substantially increase the attractiveness of firms to institutional venture capitalists.

Determinants of SME owners’ satisfaction with their banking relationships: a Canadian study

The primary goal of this empirical research study is to identify key drivers of SME satisfaction related to a variety of aspects of the bank/SME relationship. The research uses data from 3,190 interviews with key informants – identified as the person who is most responsible for financial and banking decisions – in Canadian SMEs. Research focused on how SME overall satisfaction is affected by the account manager’s management of the bank/SME relationship, the branch staff’s management of the bank/SME relationship and the bank’s policies and procedures regarding bank/SME relationships. All three drivers were significantly and strongly related to SME satisfaction with the bank with which they had their primary relationship.

Predicting alternative work arrangements from salient attitudes: A study of decision makers in the public sector

Abstract This article uses a well-researched deterministic model from the attitude literature to empirically examine how attitudes that decision makers within the Canadian federal public sector hold towards various work arrangements relate to behaviors (use of the work arrangements), intended behaviors (proposed adoption of the work arrangements), and personal preference. Attitude formation and decision making with respect to both organizational and employee quality of work life issues are considered. The results indicate that decision makers in the public sector consider organizational issues to be more important than employee issues with respect to the selection of alternative work arrangements. They also strongly support the underlying theoretical model initially proposed. Managers intentions to implement work arrangements in the future can be predicted by their current attitudes towards these work arrangements. Results from this analysis should prove useful to organizations planning to implement alternative work arrangements.

Investment Decision Making by Business Angels

This Handbook provides an excellent overview of our knowledge on the various facets of managerial venture capital research. The book opens with a thorough survey of venture capital as a research field; conceptual, theoretical and geographic aspects are explored, and its pioneers revisited. The focus then shifts to the specific environs of venture capital.

Small business bank shopping in Canada

Abstract This paper describes the findings of empirical research directed toward identifying factors associated with decisions made by Canadian small businesses to seek new banking relationships. Data were obtained from a large sample of small businesses in order to estimate the parameters of a logistic regression model of the shopping process. It was found that decisions to shop for a new bank were more likely when business owners perceived an increase in the degree of competition among banking institutions. In addition, the frequency of shopping for a new bank was increased when the existing bank did not approve the full amount of a loan (or line of credit) application. Finally, shopping occurred with greater frequency when business owners perceived a change for the worse in non-financial aspects of the banking relationship. The predictive accuracy of a logistic regression model which incorporates these variables was found to be extremely high.

Networks and linkages among firms and organizations in the Ottawa-region technology cluster

This paper reports on a study of the networking and linkage practices of technology and non-technology firms within the Ottawa cluster. The work seeks to understand how and why particular patterns of networks and linkages evolve and it examines empirically the usage and value of networks and linkages. Previous work argues that technology firms need to be relatively more adept at developing external relationships in order to be successful than do non-technology based companies. This work, however, finds that technology firms exhibit fewer linkages than non-technology based companies do within the Ottawa cluster. The research suggests that the vitality of the Ottawa cluster could be further enhanced through the promotion of additional networking and linkages among regional firms. A key implication for management practice is that CEOs of technology-based firms should work towards establishing and maintaining additional valued relationships.

A theory of how intransitive consumers make decisions

Abstract An assumption of transitivity is required for the existence of the utility function of classical economics. However, as argued in the first section, if acquiring and organizing information is costly, rational behavior may require that preferences be intransitive. One might therefore predict that this assumption will often be violated, and evidence is presented that this is the case. We go on to develop a model of preference which does not require an assumption of transitivity, and which can be readily implemented empirically using data on paired comparisons. Using a set of intransitivities, and the forecasting ability of our proposed model is compared with alternatives.

A Tale of One City: The Ottawa Technology Cluster

The Ottawa Technology Cluster is distinctive forseveral reasons, including its development in the absence of significantventure capital opportunities and the initial lack of competition among itsfirms in the product market.Although many qualitative studies existregarding this cluster, this research seeks to provide empiricalevidence.Previous research regarding both high technology clusters andthe Ottawa Technology Cluster is reviewed, focusing on topics such as the roleof venture capital investors, the use of angel capital, and the prevalence ofnetworking. Data for this study were collected via questionnaires completed by CEOs ofboth high technology (n=111) and non-technology firms (n=75) listed in theOttawa Business Journal Directory; twelve in-depth case studies werealso completed to collect more thorough qualitative data.The firms werefollowed from 2000 to 2003 to determine firm survival rates. The conclusions suggest that the Ottawa Technology Cluster remains intact asa result of non-financial contributions from informal investors and theirnetworks.Additionally, non-technology firms maintain a greater connectionto other individuals and organizations within the cluster; possibleexplanations of this finding are discussed.As discussed in the casestudies, the challenges to firm survival, as well as the strategies promotingsurvival, are discussed. (AKP)