Comparing the Initial Screening of Investment Opportunities by Business Angel Group Gatekeepers and Individual Angels

2017 Emerging Trends in Entrepreneurial Finance Conference

17 Pages Posted: 29 Mar 2017

See all articles by Colin M. Mason

Colin M. Mason

University of Glasgow - Adam Smith Business School

Tiago Botelho

University of East Anglia (UEA) - Norwich Business School

Date Written: March 27, 2017

Abstract

The nature of angel investing has changed over the past decade with the emergence of angel groups and a new actor – the angel group manager, or gatekeeper, whose primary role is to undertake the initial screening of investment opportunities. Each of the individual members of the groups then make their own evaluations of those proposals that pass the gatekeeper’s screening. This paper asks how similar or different is the approach of gatekeepers to initial screening to that of individual angels investing on their own. This has considerable practical significance as the advice given to entrepreneurs on how to become investment ready is drawn on the evidence from angels investing on their own. This issue is explored with 21 gatekeepers and 30 individual angels using Verbal Protocol Analysis, a methodology that requires participants to think out loud as they perform a familiar task – in this case the initial screening of an investment opportunity.

Keywords: Business angels, Gatekeepers, Syndication, Verbal protocol analysis, investment decision making criteria

JEL Classification: L26

Suggested Citation

Mason, Colin M. and Botelho, Tiago, Comparing the Initial Screening of Investment Opportunities by Business Angel Group Gatekeepers and Individual Angels (March 27, 2017). 2017 Emerging Trends in Entrepreneurial Finance Conference. Available at SSRN: https://ssrn.com/abstract=2941852 or http://dx.doi.org/10.2139/ssrn.2941852

Colin M. Mason

University of Glasgow - Adam Smith Business School ( email )

Glasgow, Scotland
United Kingdom

Tiago Botelho (Contact Author)

University of East Anglia (UEA) - Norwich Business School ( email )

Norwich
NR4 7TJ
United Kingdom

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