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Small Business Economics

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01.08.2013

Succession financing in family firms

verfasst von: Christian Koropp, Dietmar Grichnik, André F. Gygax

Erschienen in: Small Business Economics | Ausgabe 2/2013

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Abstract

Business succession is one of the primary management challenges for family firms. However, many family firms fail at this task because of financial issues. Although a vast number of studies have investigated the succession process, research thus far has failed to determine how and why family firms select particular forms of financing for succession-related expenditures. Accordingly, this study conceptually and empirically investigates succession financing. We introduce a conceptual framework that investigates the reasons behind an owner-manager’s intent to use debt for succession financing. Specifically, our model accounts for general and succession-related personal factors. However, we also include a set of firm-specific financing behavioral controls in our research. The empirical results are derived from a sample of 187 German family firms, and the results highlight financial knowledge, attitudes, succession experience, and succession planning as significant determinants of the owner-managers’ debt usage intentions. The implications and avenues for future research are discussed.

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This is not to say that family firms are fully congruent with small and medium-sized enterprises; however, most of these enterprises are, in fact, family firms.

The authors want to acknowledge the vast amount of literature on CEO-succession in non-family firms. These reviews, however, are outside the scope of this paper.

However, these variables will not be discussed in more detail as our paper focuses on the individual-level determinants of family firm financing.

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Titel: Succession financing in family firms
verfasst von: Christian Koropp
Dietmar Grichnik
André F. Gygax
Publikationsdatum: 01.08.2013
Verlag: Springer US
Erschienen in: Small Business Economics / Ausgabe 2/2013
Print ISSN: 0921-898X
Elektronische ISSN: 1573-0913
DOI: https://doi.org/10.1007/s11187-012-9442-z

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