The contribution of small and medium-sized enterprises (SMEs) to job creation, innovation and economic growth is acknowledged and testified in developed countries, as well as in developing and emerging economies. Although it represents an extremely small proportion of the total number of SMEs in any given country, the subsector of innovative SMEs (ISMEs) has an even greater role in creating new jobs and enhancing technological development, with a major contribution to overall economic growth. This is particularly true for advanced economies, where growth in productivity is generated not so much by the accumulation of capital as by innovation and its diffusion by the knowledge spill-over mechanism and entrepreneurial capital.
KeywordsVenture Capital Market Failure Private Equity Secondary Market Innovative Firm
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