The Economics of Small BusinessFinance: The Roles of Private Equity and Debt Markets in the Financial Growth Cycle

ArXiv ID: ssrn-137991 “View on arXiv”

Authors: Unknown

Abstract

We examine the economics of financing small business in private equity and debt markets. Firms are viewed through a financial growth cycle paradigm in which dif

Keywords: Small Business Finance, Private Equity, Private Debt, Financial Growth Cycle, Venture Capital

Complexity vs Empirical Score

• Math Complexity: 2.0/10
• Empirical Rigor: 4.0/10
• Quadrant: Philosophers
• Why: The paper is a literature review and theoretical overview of small business finance with minimal advanced mathematical derivations or heavy formulas. Empirical rigor is low as it primarily discusses available data sets (NSSBF, STBL) and survey methodologies without presenting specific statistical metrics, backtests, or implementation-heavy results.

  flowchart TD
    A["Research Goal<br>Examine economics of small business financing in private equity and debt markets"] --> B{"Methodology<br>Financial Growth Cycle Analysis"}
    B --> C["Data Inputs<br>Small business financial records<br>Private equity & debt market data"]
    C --> D["Computational Process<br>Mapping firms to growth stages<br>Analyzing capital structure & liquidity"]
    D --> E{"Key Findings<br>Outcome: Financial Growth Cycle Model"}
    E --> F["Stage 1: Bootstrapping & Trade Credit"]
    E --> G["Stage 2: Bank Debt & Venture Capital"]
    E --> H["Stage 3: Private Equity & Mezzanine Debt"]