The role of sustainability orientation and founder credibility in start-up funding

Posted on 24 Nov 2023
Updated on 24 Nov 2023
2-minute read

It is not uncommon to see an established brand aligned with environmental and social goals – but what about start-ups? This research explores if sustainability orientation leads to increased funding and how start-ups can successfully implement it into their structure.

The challenge

Sustainability Orientation (SO) refers to a firm’s pursuit of environmental and social goals in business operations. These activities reflect the expectations of customers for companies, including start-ups, to make a deliberate effort to improve the environment and society. In recent years, an increasing number of start-ups have embraced SO in their products, business models and market positioning; however, research on the relationship between SO and start-ups’ ability to raise funds is scarce. This project aims to address this research gap by developing a classification scheme for SO and examine the forms of SO on start-up funding outcomes.

Solution

To achieve this, the team will compile a unique dataset from several secondary data sources, including start-up funding databases, start-up websites and social media profiles, and social networking sites of start-up founders (e.g. LinkedIn). Understanding the determinants of start-up performance is important to Australian business communities and potential start-up founders, with findings strengthening the UTS Business School’s commitment to advancing knowledge on sustainable finance.

Outcome and impact

The novel typology of various forms of SO will reflect distinct approaches by which start-ups incorporate sustainability principles and practices in their business operations, and findings will reveal how different combinations of SO forms are associated with higher or lower levels of start-up funding.