An Institutional Perspective on Fundraising by Italian YICs

Young Innovative Companies have received considerable attention in the last decade in entrepreneurship and management literature. These firms need financial resources to develop but lack legitimacy in the eyes of investors. This paper empirically explores the determinants of fundraising by analysing 545 Italian innovative start-ups, as defined by the Law 221/2012. In an institutional perspective we propose a model that considers the effect of three different sources of legitimacy. Results show that team educational and professional diversity, incubation and IPRs play a significant role in legitimating the company in the fundraising process.