| dc.description.abstract | The objective of this study was to establish the effect of access to venture capital on
the financial performance of small and medium sized enterprises in Mombasa County.
The study also sought to establish the effect of age and size of the small and medium
sized enterprises as well as the gender and level of education of the managers on
financial performance. The study employed a descriptive research design. The target
population was the 100 small and medium sized enterprises in Mombasa County for
the year 2013. Purposive sampling was used to select the sample of study by which a
sample of 40 small and medium sized enterprises was selected. The study made use of
primary data which was collected by the use of a questionnaire. Descriptive analysis
was used to describe the data collected using percentages while regression analysis
was used to examine the effect of access to venture capital, age of the business, size of
the business, gender of the business manager and manager’s education level on
returns on assets. The regression model was evaluated using the coefficient of
determination R2 while the overall significance of the regression results was tested
using F statistic at a 5% level of significance. The significance of the independent
variables was tested using t-test at 5% significance level. It was found that 20 of the
32 respondents representing 62.5% had access to venture capital financing. The result
of regression analysis indicated that access to venture capital had a positive effect on
return on assets. The result of t-test indicated that the effect was not significant at the
5% level. The age of the business was found to have a negative effect on returns on
assets but the result of t-test indicated that the effect was not significant. Size of the
business was found to have a positive but insignificant effect on return on assets.
Gender of the business manager had a negative effect on return on asset; however the
t-test indicated that the effect was not significant. Education level of the manager was
found to have a positive effect which was also found to be insignificant after
conducting a t-test. The regression model had a coefficient of determination R2of
16.2%. This indicated that the independent variables explained 16.2% of the variation
in return on assets. The F-test for the significance of overall regression indicated that
the regression was not significant at 5% level. The study concluded that access to
venture capital had a positive but statistically insignificant effect of financial
performance. It also concluded that size of the business and education level of the
manager had positive though insignificant effect on financial performance while age
of the business and gender of the manager had a negative but statistically insignificant
effect on financial performance. The study recommends that since access to venture
capital had a positive effect on financial performance entrepreneurs may expect that
funding their business with venture capital fund will have a positive but not
statistically significant effect on financial performance. | en_US |
