Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/244573 
Year of Publication: 
2020
Series/Report no.: 
Working Paper No. 15/2020
Publisher: 
Örebro University School of Business, Örebro
Abstract: 
Business angels dominate early-stage investment in firms, but research on their investment effects is scarce and is limited by sample selection. Therefore, we propose an algorithm for identifying business angel investments from total population data. We apply the algorithm to study business angels' effects on firm performance, using detailed and longitudinal total population data for individuals and firms in Sweden. Employing these data and a quasi-experimental estimator, we find that business angels invest in firms that already perform above par. There is also a positive effect on subsequent growth compared with control firms. Firms with business angel investments perform better in terms of sales growth, employment growth and the likelihood of becoming a high-growth firm. However, contrary to previous research, we cannot find any impact on firm survival. Overall, our results underline the need to address sample selection issues both in identifying business angels and in evaluating their effects on firm performance.
Subjects: 
business angels
firm performance
sample selection
population data
JEL: 
C23
G24
G32
L25
Document Type: 
Working Paper

Files in This Item:
File
Size
565.66 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.