Startup Capital and Business Development: The Nexus from IGBO Perspective

Abstract

Businesses especially small and medium scale enterprises are often faced with the problem of sourcing adequate fund that will enable them to start and successfully expand their business. To this effect, this study examined the relationship between startup capital and business development among businesses in Anambra State, Nigeria. The study anchored on financial growth cycle theory. The study adopted descriptive survey research. The study covered Awka South Local Government. The population of the study comprises 553 of the owners and management of thirty (30) small businesses in Awka South while 232 sample size was determined using Taro Yamane. Structured Questionnaire was used to elicit relevant information from the respondents. Data gathered were analyzed using simple frequency tables while Pearson Product Moment Correlation Coefficient was used for the test of hypotheses. The study revealed that there is significant positive relationship between grants and product development, also there is significant positive relationship between crowdfunding and market expansion of small businesses in Anambra state. The study concluded that startup capital has significant positive relationship with business development in Anambra state, Nigeria. Based on the findings, the study recommended that governments should offer grants and subsidies to small businesses to enable them to expand their business. Also, owners of small businesses should engage in crowdfunding as a means of raising capital for business growth and expansion.