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The Effects of New Ventures' Resource Strategies on Angels' Investing Outcomes: Big Gains and Big Losses in Angel Investments

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  • Wu Zhenyu

    (University of Manitoba)

  • Yuan Wenlong

    (University of Lethbridge)

  • Wei Xueqi

    (Fudan University)

Abstract

Based on a sample of 539 angel investors, we empirically test the impact of new ventures' resource acquisition/allocation strategies in different development stages on angels' abnormal returns and their extremeness. Our exploratory findings suggest that at early stages of development, ventures whose entrepreneurs focus more on resource acquisition/allocation strategies tend to not only give angel investors lower returns, but also pull angel's returns back to the industry average. Furthermore, these effects at early stages are more visible than those at late stages of the ventures.

Suggested Citation

  • Wu Zhenyu & Yuan Wenlong & Wei Xueqi, 2012. "The Effects of New Ventures' Resource Strategies on Angels' Investing Outcomes: Big Gains and Big Losses in Angel Investments," Entrepreneurship Research Journal, De Gruyter, vol. 2(3), pages 1-27, July.
    • Handle: RePEc:bpj:erjour:v:2:y:2012:i:3:n:3
    DOI: 10.1515/2157-5665.1058
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    References listed on IDEAS

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    1. Zachary Ramona & Mishra Chandra S., 2013. "Research on Angel Investments: The Intersection of Equity Investments and Entrepreneurship," Entrepreneurship Research Journal, De Gruyter, vol. 3(2), pages 160-170, January.

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