Dr Jeff Cornwall

The Milken Institutute has released a report titled “The Best Markets for Entrepreneurial Finance.” While this is an interesting study to consider, it is not the complete picture. The measure of access to capital that is used in this study to compare the financial climate around the globe really measures external financing and is too heavily weighted toward equity financing to accurately measure the real nature of entrepreneurial financing.
Almost four out of five start-ups in the US use some combination of self-financing and/or friends and family. The next largest source is debt financing. Less than one percent use equity financing. I do not know if this reflects entrepreneurial financing in the rest of the world, however. That would be an interesting study that might better explain why the US can lead the world in entrepreneurial activity, and yet ranks only fourth on this index.