For a young technology company, a promising invention is only the beginning. The founders still need to build, test, sell, deliver and support it, often with a very small team and limited cash. A study of Swedish technology firms suggests that some of the most useful growth reniversity and research institute partners, and, in certain circumstances, external finance.1
The results are useful because they shift attention from the size of a startup’s funding round to the practical capabilities it can access. Capital matters, but the right relationships can help a company turn capital and technical knowledge into products customers can actually buy. The evidence is also bounded: the study follows one cohort of Swedish firms over 2014 to 2016, and several financing results come from a small subgroup. It is a prompt for better questions about startup growth, not a universal formula.
What The Study Examined
In “Growth in new technology-based firms: early partnerships and financial capital,” Hans Löfsten examined 241 independent Swedish technology-based companies founded in 2013. The firms were very small, averaging fewer than two employees in 2014. Researchers compared early sales growth with firms’ reports of ongoing partnerships and outside financing. The partnerships included suppliers, subcontractors, distributors, local authorities, and universities or research institutes.
The study looked at relationships that continued beyond a one-time transaction. That distinction matters. A startup can purchase a component from a vendor once, or it can develop an ongoing working relationship with a contractor who understands the product, helps improve production, and can increase capacity as orders grow. Those arrangements may create very different benefits.
Findings At A Glance
| Relationship or resource | Reported association with early growth | Study context |
|---|---|---|
| Subcontractors for production | Positive | Full-sample models |
| Universities or research institutes | Positive | Externally funded firms |
| Local authorities | Negative | Externally funded firms |
| Crowdfunding | Positive in one model | Exploratory analysis of externally funded firms |
| Family and friends funding | Negative | Exploratory analysis of externally funded firms |
The study also found that having obtained external funding was positively associated with growth in one full-sample model. Within the externally funded group, however, the results varied byings are exploratory and conditional
Why A Subcontractor Can Be A Growth Asset
The clearest partnership result was the positive association between production subcontractors and early sales growth. This offers a practical insight for founders: growth does not always require building every capability in-house. A young company may be able to serve more customers by contracting a specialized manufacturing step, testing process, software component, or other part of its delivery chain.
That approach can change the economics of experimentation. Hiring a full team or buying equipment creates fixed costs before demand is certain. A carefully chosen subcontractor can provide access to skills and capacity when needed, allowing founders to keep more attention on product development, customer feedback, and sales. If demand proves durable, the company can later decide whether to internalize that capability.
Research Partnerships Can Connect Invention To Use
University and research institute relationships were positively associated with growth among firms that had external funding. Such partnerships can provide access to laboratories, specialist equipment, technical expertise, testing, and talent that a micro-sized company could not afford to build internally. They may also help a young business establish credibility with customers and other investors.
But a research connection becomes commercially valuable only when it helps solve a customer or production problem. A prototype may work in a controlled setting but fail under real operating conditions. A research partner can help validate performance, improve a process, or establish what the technology can reliably do. Founders still need a route from that evidence to a buyer, a repeatable product, and revenue.
Funding Is Not One Thing
The paper adds nuance to the familiar claim that startups need more capital. In its full sample, firms reporting external funding showed a positive association with sales growth. Within the much smaller funded subgroup, crowdfunding showed a positive association in one model, but it was not statistically significant after additional controls were added. Family-and-friends funding showed a negative association across the subgroup models. Bank loans, risk capital, and public funding did not show statistically significant relationships.
Those results do not establish that crowdfunding causes growth or that family support holds companies back. Firms choose funding sources for different reasons. A company with a product that is easy to demonstrate to a broad audience may be more likely to crowdfund and may already have customer interest. A founder facing a difficult market or limited financing options may rely on family. In that case, the funding pattern may reflect the company’s circumstances, not the effect of the money itself.
The financing analysis was based on 40 firms reporting external funding, with 35 included in the regression models. This is too small to rank funding channels for technology startups generally. It does, however, support a more useful founder question: what does this capital enable, and what obligations or signals come with it? A loan, a venture round, a public grant, and a crowdfunding campaign offer different amounts, timelines, governance demands, and access to networks.
What The Evidence Can And Cannot Tell Founders
The survey records whether a partnership or fundinge the analysis is observational, a positive relationship does not prove that the partnership produced growth. Better-managed or faster-growing companies may simply have been more capable of forming useful partnerships
Even so, current ecosystem research reinforces the larger point that early finance and scale-up finance are different problems. The OECD’s 2026 financing scoreboard describes venture capital as particularly relevant to innovative startups with intangible assets that are difficult to use as collateral. In Sweden, the SVCA’s 2025 private equity report tracks investment across venture, growth, and buyout stages, reminding readers that “startup capital” covers several distinct markets. Meanwhile, the European Investment Bank’s work on the scale-up gap examines the financing constraints firms face after they have moved beyond the earliest stage.
From A Startup’s Network To The Investment Landscape
Recent Securities.io coverage offers two examples of how financing can look very different across the company lifecycle. Collective’s $100 million Series B and growth facility combines equity with a credit facility for an AI-native financial platform. A separate report on Disruptive Technology Advisers’ $10 billion flagship fund describes concentrated capital aimed at scaling private technology companies. These are not comparable to the Swedish micro-firms in the paper, but they illustrate why investors should distinguish early resource-building from later-stage scaling.
For public-market exposure to a firm active in early-stage technology investing, EQT AB is a relevant company to examine. Its EQT Ventures strategy backs early-stage companies and supports founders as they scale, while EQT Growth focuses on technology businesses across areas including enterprise software, fintech, health technology, consumer technology, and climate technology. EQT is not evaluated in the study, and its performance should not be inferred from the study’s findings. The connection is that EQT’s business gives investors a listed way to follow a manager participating in the broader venture and growth ecosystem. EQT AB is listed on Nasdaq Stockholm under the symbol EQT, as shown on TradingView.
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The Bigger Lesson: Build A Capability Network
For founders, the study’s most durable lesson is to map the capabilities a company needs before deciding which partnerships or fundingfacturing partner, regulatory expertise, a first distribution channel, or a bridge to a major customer. Naming the bottleneck makes it easier to identify whether a university, subcontractor, investor, grant, or crowdfunding campaign is likely to help
- Identify the capability that is slowing product or sales progress.
- Choose a partner or funding source that directly addresses it.
- Set measurable milestones and review the relationship as the company grows.
For investors, the same framework encourages a closer look at what capital actually unlocks. A funding announcement is one data point. Evidence of customer adoption, repeatable delivery, stronger technical performance, and partnerships that expand capacity can help show whether the company is converting resources into a durable business. The paper cannot tell readers which startup will win. It does suggest that growth may be shaped by a company’s ability to combine money with complementary people, infrastructure, and market access.
References:
1 Löfsten, H. (2026). Growth in new technology-based firms: Early partnerships and financial capital. Management Decision, 64(13), 950–978. https://doi.org/10.1108/MD-01-2026-0358
