Who is a good advisor for entrepreneurs?

This paper examines the effects of external advice on entrepreneurs’ fundraising and business performance while distinguishing the sources of advice, by using a survey in Japan that includes 3, 011 new firms. We find that advice from managers in the same industries contributes to solving entrepreneurs’ fundraising problems not only before startup but also immediately after startup. Their advice also helps increase the amount of external funding which entrepreneurs obtain at the time of startup. We also find that advice from accountants contributes to enhancing new firms’ performance immediately after startup. Their advice also contributes to enhancing their performance after the screening of projects, suggesting that such advice also serves as value-added in terms of the enhancement of new firms’ business performance.