It turns out that the myth of the entrepreneur who raises her first round of funding from friends and family isn’t actually true. In fact, 75 percent of aspiring U.S. entrepreneurs rely on external debt sources, as opposed to capital from family and friends.
A team at the Kauffman Foundation reported on the first funding decisions that startup founders make. The data came from the Kauffman Firm Survey, which tracks business characteristics, cash flow, and owner demographics for over 5000 new firms, to identify from whom firms choose to raise capital and how that decision impacts the long-term growth of the firm.
