Project R-15180

Exploring Behavioral Drivers of Entrepreneurial Finance Decisions in Family Businesses: A Multidisciplinary Approach Bridging Family Science and Behavioral Finance (Research)

This research project bridges the gap between the family science research domain and the finance literature. Family businesses exhibit unique characteristics that shape their decision-making processes. Regarding financial decisions, these businesses seem to find it challenging to navigate the labyrinth of funding sources and especially to find their way to more innovative ways of financing. This research project aims to illuminate various important antecedents of entrepreneurial finance decisions in family businesses. In particular, it will consider the potential impact of the different personality traits of various financial decision-makers in family firms, such as CEOs, financial managers, and family members. Furthermore, it will consider family communication patterns and family values, potential cognitive biases such as overconfidence and over-optimism, and potential differences in these antecedents between family and nonfamily CEOs and CFOs. The outcomes will contribute to the literature on behavioral finance as well as the family science field and equip family businesses with the tools to leverage their distinctive traits to optimize their choices of using specific entrepreneurial financing forms.

16 September 2024 - 15 September 2028