Abstract

http://ssrn.com/abstract=1457744
 
 

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Plastic Capital: Credit Card Debt Financing Among Startups


Robert H. Scott III


Monmouth University

August 10, 2011


Abstract:     
This paper examines the increased use of credit cards for debt financing among startups. Credit cards are useful for startups because of their near-universal acceptance, accessibility and anonymity. But an increasing number of startups are relying exclusively on credit card debt for financing, which can have high carrying costs relative to traditional business loans. Using the Kauffman Firm Survey data several models are developed that analyze the differences in survival rates among startups depending on how heavily they rely on credit card debt for funding in their first four years in operation.

Keywords: bootstrapping, credit card debt, Kauffman Firm Survey, startups

JEL Classification: M19

working papers series


Not Available For Download

Date posted: August 20, 2009 ; Last revised: August 11, 2011

Suggested Citation

Scott, Robert H., Plastic Capital: Credit Card Debt Financing Among Startups (August 10, 2011). Available at SSRN: http://ssrn.com/abstract=1457744

Contact Information

Robert H. Scott III (Contact Author)
Monmouth University ( email )
400 Cedar Ave.
West Long Branch, NJ 07764
United States
732-263-5532 (Phone)
HOME PAGE: http://www.monmouth.edu/academics/economics_finance_and_real_estate/faculty/RobertScott.asp
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