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Are Some Angels Better than Others?

Author

Listed:
  • Johan Karlsen
  • Katja Kisseleva
  • Aksel Mjøs
  • David T. Robinson

Abstract

This paper uses Norwegian tax records to examine the performance of angel investors. While most angel investments perform poorly, mean returns are twice the invested capital, due largely to extreme skewness: around one-third of investments are a total loss, but the top one-percent return more than fifty times invested capital. Performance persistence among angels is largely attributable to unobserved investor characteristics. Professional networks are critical determinants of performance: top-performing angels tend to have broader business connections with startups and fellow investors, consistent with having access to superior deal flow.

Suggested Citation

  • Johan Karlsen & Katja Kisseleva & Aksel Mjøs & David T. Robinson, 2024. "Are Some Angels Better than Others?," NBER Working Papers 33231, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:33231
    Note: PR
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    More about this item

    JEL classification:

    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • G50 - Financial Economics - - Household Finance - - - General
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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