Abstract
This paper documents that ventures that are funded by two successful angel groups experience superior outcomes to those that are rejected: they have improved survival, exits, employment levels, patenting, web traffic, and financing. We use strong discontinuities in the funding behavior of angels over small changes in their collective interest levels to implement a regression discontinuity approach. We confirm the positive effect of angel financing on most operations of the venture, with qualitative support for a higher likelihood of successful exits. On the other hand, there is no difference in access to additional financing around the discontinuity. This might suggest that financing is not a central input of angel groups.
Reference
William R. Kerr, Josh Lerner, and Antoinette Schoar, “The Consequences of Entrepreneurial Finance: Evidence from Angel Financings”, January 2011.
See also
Published in
January 2011