Are Some Angels Better than Others?
We explore how the returns to angel investing relate to the financial, human, and social capital of the individual investors. Better-performing angels earn their higher returns through greater access to right-tail outcomes, not by avoiding losses. Wealthier and better financially connected angels invest in larger firms, but the returns to nonfinancial capital are substantial. Angels with relevant business experience earn higher returns than others in the same firm, especially when they take board seats. Social connections to founders and outside investors are also important. These findings have important implications for household finance and entrepreneurship policy.
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Copy CitationJohan Karlsen, Katja Kisseleva, Aksel Mjøs, and David T. Robinson, "Are Some Angels Better than Others?," NBER Working Paper 33231 (2024), https://doi.org/10.3386/w33231.Download Citation
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