Effect of buyer dependency of subcontracting SMEs on R&D investment

PurposeThis study aims to focus on the subcontracting relationship between small and medium-sized enterprises (SMEs) and business group buyers and analyze the effect of the level of buyer dependency on R&D intensity. The primary prediction is that buyer dependency and R&D intensity have a non-linear relationship, showing an inverted U-shaped relationship. Furthermore, the moderating effect of founder CEOs and internationalization is explored.Design/methodology/approachA sample of 546 firm-level survey responses were collected from Korean subcontracting SMEs provided by the Ministry of SMEs and Startups and the Korea Venture Business Association.FindingsA lower level of dependency on business group buyers promotes R&D investment, while excessive dependence reduces R&D investment. Moreover, founder CEOs and internationalization decrease the effect of buyer dependency on R&D investment, implying that both firm characteristics are associated with a long-term focus and promote R&D investment.Research limitations/implicationsThis research contributes to the literature on the special form of the buyer–supplier relationship, that is, subcontracting. Subcontracting has a contradictory effect on R&D investment based on large group buyer dependency, and this relationship is moderated by the founder CEO and internationalization.Practical implicationsThis study provides insights to managers and practitioners governing SME subcontracting by showing that the level of buyer dependency is better managed in promoting innovation, and the long-term perspective allows SMEs to be less affected by buyer dependency.Originality/valueThis study extends the literature by focusing on the non-linear relationship between buyer dependency and R&D intensity of subcontracting SMEs. This approach addresses the contradicting results suggested by prior supply chain management literature and suggests that the level of buyer dependency should be considered when analyzing the subcontracting relationship.

THE MANAGEMENT OF VENTURE CAPITAL AS A TYPE OF FINANCIAL RESOURCES: GOALS & OBJECTIVES

In the context of Ukraine’s integration into the world market, there is a growing interest in creating a control system for all stages of venture capital activities. The mechanism of effective management of venture activities of an enterprise should become a tool for establishing this system. The system of information flows is of great importance, which provides information to the process of making management decisions on a risky innovative project at a venture capital enterprise. The purpose of the venture business is to make a profit on the invested funds [1]. Unlike simple investment, venture capital is the most risky form of capital investment. However, if the project is successful, venture capital investment is the most profitable. Venture investment is, on the one hand, a way of financing the innovative vector of the economy, on the other, an innovative form of entrepreneurship. The main goal of venture capital financing is that the monetary capital of some entrepreneurs and the intellectual capabilities of others (original ideas or technologies) are combined in the real sector of the economy in order to bring profit to both types of entrepreneurship in a new company.

Marketing Mix Strategy Remile

Craft is one of the oldest cultures in the world. In this modern era, the craft has become one of the export engines in Indonesia, especially in the Indonesian creative economy subsector and with this the craft has become the third largest contributor to gross domestic product (GDP). This has become one of the supporting factors that led to the emergence of new ventures or new businesses in East Java engaged in the craft industry. Remile is a new venture business engaged in the field of crafts, namely leather crafts, based in Surabaya. In late 2017, the Remile company began to create and implement a marketing plan which ultimately led to significant sales. This research was conducted with the aim of knowing Remile's marketing plan in the form of a marketing mix, which was created and used to drive sales Remile products significantly with descriptive methods that use data collection techniques in the form of in-depth interviews and structured interviews. Based on the result of the interviews, Remile make several stages or sequences in its making of their marketing mix starting with the creation of a marketing plan to marketing mix that aims to maximize and provide effectiveness Remile in carrying out marketing.

VENTURE BUSINESS IN UKRAINE AND DIGITAL INNOVATION HUBS AS AN INSTITUTION OF ITS DEVELOPMENT

Expert research shows that the strengthening of digitalization trends, in particular, the use of digital technologies in the process of developing innovative businesses in Europe, will allow to receive an additional 110 billion euros annually over the next five years. Specialists note that such digital transformations should be implemented on the basis of specialized ecosystems: hubs, which include a wide range of startups, small and medium-sized businesses, scientists and researchers, consultants on digitalization and digital business management, big business, accelerators and investors. The joint activities of all these actors form a synergistic effect for innovative development. The development of venture business is based on attracting the appropriate amount of financial resources, as well as a number of other consulting and mentoring services. However, the peculiarities of such support depend on the stage at which the venture business is. The seed round of financing is characterized by a strong financial risk for direct investors, which is due to the return on investment and profit only in the long run. Instead, it is at the initial stage of creating a venture business that organizational problems often arise, related to the preparation of business plans and the final selection of the team, in particular, the establishment of digital competencies. Rounds A and B support the venture business, which already has a ready-made innovative product and a certain audience of enthusiastic users. However, there is an urgent need to commercialize innovation. The venture startup still has problems with monetizing the results of its activities, developing the concept of an innovative product-leader. Scaling the production of innovative products requires significant improvements associated with additional marketing research on the priorities of the target audience at the global level, the need for business planning. The digital innovation hub serves as a platform for the formation of synergistic cross-sectoral partnerships that creates the foundation for the development of innovative business.

Technology of establishing cooperation between venture investor and innovative enterprise

In the article it is established that today in Ukraine the development of venture investment of innovative enterprises is at an early stage and is characterized by a number of problems. The dynamics of venture capital in Ukraine shows that their number and capitalization have been growing rapidly during the research period 2011-2019, and this growth continued even after the crisis. It is worth noting that venture investments in Ukraine are made in points, in particular they are more concentrated in Kyiv and Lviv. The largest share of venture capital is international capital. The most attractive sectors for venture investment in Ukraine are software, online services and IT equipment. According to the results of studying domestic and foreign experience of venture investment, a number of obstacles in the development of venture business in Ukraine have been identified: instability of the external environment; underdeveloped venture infrastructure; low level of efficiency of regulation of venture investment at the legislative level; low liquidity of venture capital due to the low level of stock market development; the predominance of foreign origin of venture capital and the shortage of domestic investment resources; underestimation of the role of small and medium business in the innovative development of the economy; low level of quality of venture fund management; weak information support and insufficient transparency of venture business. Based on the best foreign experience of venture business and existing problems in the field of venture investment in Ukraine, a technology for attracting venture capital at the stage of negotiating and concluding a venture investment agreement has been developed. The proposed technology will provide an opportunity to form a unified and clear basis for concluding a venture investment agreement between foreign venture investors and domestic innovative enterprises. The use of the proposed technology in the domestic practice of venture investment will increase the attractiveness of cooperation with Ukrainian innovation organizations in the eyes of foreign investors. This, in turn, will intensify the attraction of foreign investment in the development of the innovative sector of the national economy.

VENTURE BUSINESS EFFICIENCY MANAGEMENT

Purpose. Since the venture business is a catalyst for structural adjustment and technological renewal of the country’s economic complex, small firms with the support of venture capital effectively create and sell innovations that become the basis of new economy sectors. Effective organization of venture activity requires analysis of the main trends in developing organizational forms of venture business and the creation of venture funds. This article aims to form a coherent system of indicators for evaluating the effectiveness of venture projects to manage the energy of venture business and the characteristics of these indicators. Scientists and their features present the analysis of available indicators or systems of indicators for evaluating the effectiveness of venture business. Design/methodology/approach. This study used both general scientific methods, empirical and theoretical, in particular, the process of analysis (in the study of indicators for evaluating the effectiveness of venture business), synthesis (in the formation of a coherent system of indicatorsfor assessing the effectiveness of venture business), generalization and explanation, classification, and also system (for coordination of the system of hands). Also, unique research methods were used, in particular, formal-logical and comparative forms ofscientific knowledge. Findings. The article’s indicators of evaluating the effectiveness of venture investments in innovative projects have been investigated and analyzed. A critical analysis of methodological approaches to assessing the effectiveness of venture capital has been done. It is proposed to evaluate the effectiveness of venture projects on such indicators as internal rate of return, modified internal rate of return, net present value, payback period, discounted payback period, the profitability of sales, average rate of return, discounted profitability index, and contribution index-adequate assessment of the balance of indicators for assessing the effectiveness of venture investments. Practical implications. The article proposes to evaluate the effectiveness of venture projects on such indicators as internal rate of return, modified internal rate of return, net present value, payback period, discounted payback period, the profitability of sales, average rate of return, discounted profit index and profit income which will contribute to obtaining a comprehensive and adequate assessment of the balance of indicators for assessing the effectiveness of venture investments. The formation of a coherent system of indicators for evaluating the effectiveness of venture projects will manage venture business efficiency. The intensification of venture activity in Ukraine requires developing an integrated approach, covering institutional development, legislation, and macroeconomic regulation. The story of venture business will contribute to achieving the most critical state goals: the improvement of the innovation sphere and increasing the competitiveness of the domestic economy by entering world markets. The practical application of methods for assessing investment effectiveness is carried out using indicators NPV, IRR, PP, and others. The formation of a portfolio of innovative projects based on linear programming’s classical problem can not be applied in full. That is why today, it is essential to solving issues related to the development and improvement of methods and models of venture risk analysis, assessing the attractiveness of innovative projects, and forming a creative portfolio by a venture company. The participation of venture investors in the capital ofstartups is attractive for several reasons: the presence of venture funds in shareholders tells partners and potential employees that the audit of the company means that the business is transparent and the funds risked their money in terms of growth prospects; venture capitalists help in management. After all, they have experience supporting and developing similar startups; you can use the fund’s companies’ expertise, for example, in organizing sales or preparing for an IPO. Finally, investor connections open up partnerships with other companies, attracting experienced professionals, such as marketing, commercial, financial, executive director. But experts go only to projects with a clear business structure, and venture funds guarantee its presence. Because venture investors, as mentioned above, have a foundational approach to the companies they finance and are initially focused on leaving the company by selling their stake to a strategic investor, company management, or the stock market, the key to success for them, in our view, is a growth company value.

The Efficiency of the Venture Investment Process

Since the venture business is of particular importance in the processes of creating an efficient and competitive economy, the article is devoted to the assessment of the effectiveness of the venture investment process. The authors studied the theoretical prerequisites for assessing the effectiveness of the venture investment process; namely, they identified the features of venture investment, the state of venture investment in Ukraine, considered the leading performance indicators and analyzed the characteristics of evaluating the effectiveness of venture capital enterprises. This made it possible to propose an algorithm for assessing the effectiveness of the venture investment process, consisting of 4 stages.

A critical analysis of tithe and seed sowing on contemporary Christianity in Nigeria

The issues of tithes and seed sowing have taken a central focus in contemporary Christianity in Nigeria among the preachers. Many a time, it is assumed that tithes and seed sowing are requirements for salvation, prosperity and total well-being of the members. Making many to believe that Christianity is a money-venture business one can succeed if he knows how to hoodwink the gullible. Many have been deceived that by parting with a substantial amount of money in the name of sowing seed, their problems would be solved. Unfortunately, the person’s problem may remain the same or even be compounded. This paper evaluates the activities, attitude and their inordinate ambitions. It examines the impact of tithe and seed sowing on Christianity in Nigeria. The research method adopted for this work is the qualitative phenomenological method. The paper observed that the value of tithe and seed sowing has changed from what is prescribed in the bible to what is preached on the pulpits. The study recommends among other things, that these preachers should preach the gospel with decorum and as it were in the bible so that its influence on Nigerians will bring about a reduction in crime, corruption and other immoral activities in Nigeria.Contribution: The article is focused on the issues of tithes and seed sowing. It underscores the fact that the message of tithe and seed sowing has become a means of siphoning members and enriching the preachers. It further reveals its negative and positive impacts such as, the promotion of corruption and fraud in the church and society, contribution to the decline of morality in the church and the society, increasing crime rate and increasing poverty rate in Nigeria among others.

Development of the Russian and world industrial economies: theory, practice, specificity of venture business

The scientific and practical relevance, timeliness and practical and applied relevance of the selected research topics are empirically substantiated by the processes of sustainable development of world labour markets, improving the quality of human resources, increasing the importance of scientific and educational activities, acquiring unique competencies, knowledge and skills by workers of modern business entities, deepening specialization and differentiation of science-intensive enterprises, permanent scientific and technological progress and acceleration of the pace of formation of industrial-industrial clusters and venture business. The theoretical and practical goals of the publication are to study the socio-economic mechanisms for solving the theoretical and practical-applied problems of sustainable innovative development of the industrial economy and the implementation of science-intensive projects characterized by high production and economic uncertainty and significant socio-economic risk, which are not amenable to formalization. The theoretical and methodological basis of the publication was the scientific works of domestic and foreign scientists-researchers of socio-economic algorithms for the development of domestic and world economies of industry, as well as venture business. Scientific novelty lies in the critical rethinking of such a constructive and creative result of the venture business as the formation of public-private partnerships and the author’s interpretation of strategically significant science-intensive segments of the industrial economy (telecommunication technologies, medicine, microbiology, production of substitute products, innovative energy trends, the search for alternative sources of energy supply, etc. etc.). The practical significance of the results obtained lies in the comparative characteristics of the American and Eurasian strategies for the innovative development of industry, as well as the empirical argumentation of their socio-economic advantages and disadvantages. The article reveals a reduction in costs and a regression of transactions between production and economic services of American companies, savings due to the narrow focus of scientific and production processes with a simultaneous absence of material incentives for labour activity and the occurrence of costs due to the regulation of labour functions of workers. The use of a progressive system of remuneration of labour and bonuses to personnel of Eurasian companies has been established in the context of a simultaneous increase in resource and raw materials and monetary costs and the liberalization of in-house management, which are of priority importance for the formation of a strategy for the development of the Russian industrial economy

CURRENT TRENDS IN THE DEVELOPMENT OF VENTURE ENTERPRISE IN UKRAINE

The article is devoted to the analysis of quantitative and structural parameters of venture business development in Ukraine, so it seems appropriate to focus on its most generalizing features and characteristics, which have been clearly outlined in recent decades. First of all, it should be noted the extremely low level of capitalization of the domestic venture capital market. Also important for a comprehensive analysis of the current state and trends in domestic venture entrepreneurship is the number of venture capital investment institutions and a significant increase in the level of concentration of the domestic asset management market. Another conclusion that follows from the data concerns the dominance of venture mutual investment funds, ie closed-end funds, in the subjective structure of domestic venture entrepreneurship. Domestic venture funds are also characterized by an extremely insignificant share of the value of their assets in the gross domestic product of our state. Another well-established trend in the structural dynamics of domestic venture funds in the last decade is the growing share of foreign capital in the structure of their investment flows. In addition, in recent years there has been a clear eloquent trend, namely: the growing share of domestic individuals in the subjective structure of investors in venture mutual investment institutions. International corporate structures, business incubators and accelerators are actively opening their innovative divisions and representative offices in our country. It is worth noting that the number and volume of funding for Ukrainian startups is increasing from year to year. In recent years, the processes of attracting funding through crowdfunding platforms and grant sources have been developing dynamically. Evidence of the growing interest of foreign venture capitalists in Ukrainian startups is the intensification of mergers and acquisitions in this area. Unfortunately, maintaining the extremely low economic motivation of venture capitalists to invest money in the early stages of research and self-search by inventors in most cases leads to dependence on investors and unequal exchange of property rights for scientific ideas for financial resources.