Abstract
Abstract: Conceptualising early-stage new venture informal investors as co-entrepreneurs whose actions are socially embedded, we examine the role of social influence and how it interplays with entrepreneurial experience at the individual level leading to informal investment. We extend theories of social homophily and social influence to argue that informal investment decisions are influenced by shared experience and entrepreneurism in peer groups. We test our hypotheses with a multi-level model using first a large cross-country dataset and next in depth within a country. Our analysis reveals that both individual entrepreneurship experience and peer group-embedded experience significantly influence the likelihood that an individual becomes an early-stage investor. Furthermore, these social effects substitute for the lack of individual entrepreneurial experience.
Original language | English |
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Journal | Small Business Economics |
Early online date | 3 Aug 2021 |
DOIs | |
Publication status | Published - 31 Dec 2021 |
Keywords
- Angel investors
- Entrepreneurial experience
- Entrepreneurship capital
- Global Entrepreneurship Monitor (GEM)
- Informal investors
- Peer influence
- Social homophily
ASJC Scopus subject areas
- General Business,Management and Accounting
- Economics and Econometrics