PRODUCT DEVELOPMENT IN INNOVATIVE SMES FOLLOWING CONTEMPORARY FINANCING: CHANGES IN DEVELOPMENT STAGE AND REVENUE: PRODUCT DEVELOPMENT IN INNOVATIVE SMES FOLLOWING CONTEMPORARY FINANCING

This study examines changes in product-development stages among innovative small and medium-sized enterprises (SMEs) following contemporary financing and evaluates whether development-stage advancement is associated with revenue growth. Data were collected in 2025 through an electronic questionnaire. The final sample comprised 57 innovative SMEs from 11 European countries that had received grants, business angel investment, venture capital, crowdfunding, or a combination of these financing models. Development stage and revenue category were observed before financing and during the first three post-financing years. The Friedman test revealed a statistically significant difference in development stage across the four observation points (χ²(3) = 58.12, p < 0.001), with a moderate effect size (Kendall’s W = 0.34). Following a slight decline in the first year, the mean development-stage score increased substantially in the second and third years. Although 77.8% of firms that advanced to a higher development stage also reported revenue growth, the association between development-stage advancement and revenue-category change was weak and statistically non-significant (Spearman’s ρ = 0.185, p = 0.169). The findings indicate a delayed post-financing pattern in product development, while development-stage advancement alone does not sufficiently explain revenue growth.