The impact of environmental sustainability on willingness to invest in startups: A survey among private investors

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This study investigates the impact of environmental sustainability on willingness to invest (WTI) in startups vs. established companies. Using data from a survey among private investors, we compare measures of WTI and the perceived return–risk ratio (RRR) for both environmentally sustainable and non-environmentally sustainable startups and established companies. The results indicate that environmental sustainability significantly and positively influences WTI for both startups and established companies, with a notably stronger effect for startups. Non-environmental sustainability significantly decreases WTI. Environmental sustainability has a significantly positive impact on the perceived RRR for both startups and established companies, although startups are rewarded more than established companies for environmentally sustainable practices. This highlights that entrepreneurs have a financial incentive to prioritize environmental impact, and the demand for environmental sustainability can provide startups with an advantage in capital raising. This research contributes to the limited literature regarding sustainable entrepreneurship and environmental sustainability's specific impact on WTI.

Original languageEnglish
JournalSustainable Development
Number of pages24
ISSN0968-0802
DOIs
Publication statusE-pub ahead of print - 06.11.2024

Bibliographical note

Publisher Copyright:
© 2024 The Author(s). Sustainable Development published by ERP Environment and John Wiley & Sons Ltd.

    Research areas

  • CSR, ESG, impact investing, responsible investments, sustainable entrepreneurship, sustainable finance
  • Management studies

DOI

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