Abstract

This study investigates how investors can strengthen their value investment by applying the SWOT analysis in the Start-up company context. By conducting a constructive study with two cases, we develop a construction for qualitative and quantitative reference information with the help of the literature on Start-ups and value investment, the data on CB insights.com. This reference information for two Start-ups comprises funding data, investors, web traffic, news articles, patent data, and regulatory filings. This study also associates each information element to the internal factor assessment and external factor assessment of two Start-ups and accordingly develops metrics regarding the value investment. In addition, it demonstrates the different nature of two Start-ups for operating business to highlight the divergent value metrics. The key contributions of this study are the developed construction for qualitative and quantitative reference information and concluding that the founding team, market, product, business model, and competition are important factors for the development of Start-up company and investors' decision-making. The results of this study, and particularly the developed criterion, build avenues for further research on Start-ups and value investment.

Highlights

  • The term of Start-up company appeared after the second world war and had a really significant development since the 90s

  • A firm is considered as a Start-up company that should possess some special characteristics, including innovation, new products, the rapid growth of its sales, and maximum age [1,2]

  • The definition of Start-ups is companies or ventures that are focused around a single product or service that the founders want to bring to market. These companies typically lack a fully developed business model and adequate capital to move into the phase of business, which is the reason that they look for capital from a variety of sources such as venture capitalists, family and friends, crowdfunding, and loans

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Summary

Introduction

The term of Start-up company appeared after the second world war and had a really significant development since the 90s. The definition of Start-ups is companies or ventures that are focused around a single product or service that the founders want to bring to market. According to the data provided by CB insights in December 2020, there are 372 Start-ups around the world valued at $1B+ and China’s Bytedance is the most valuable "unicorn" company in the Artificial Intelligence category, which values $140 billion, and followed by Didi Chuxing values $62 billion [3]. These are embodied the important position of Start-ups in the contemporary economic system. This paper will fill up the research gap in the literature and have a theoretical significance to some extent

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