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Experience, heuristics and learning: the angel investment process

Mason, Colin and Smith, Donald J. and Harrison, R.T. (2010) Experience, heuristics and learning: the angel investment process. In: Frontiers of Entrepreneurship Research 2010, 1900-01-01, Babson College. (In Press)

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    Abstract

    This paper extends the literature on the investment decision-making of business angels. Using insights from entrepreneurial learning theory we explore whether angels learn from experience, how they learn and what they learn. These issues are addressed using Verbal Protocol Analysis, a methodology for examining decision-making in real time, on three groups of business angels with differing levels of investment experience, and follow-up interviews with these angels. This reveals some differences in the speed of decision making and the emphasis given to various investment criteria. The relatively limited extent of the contrasts can be attributed to two factors. First, angel learning has been in terms of their approach to investing rather than fundamentals. Second, this learning has had more effect on how they conduct their due diligence on opportunities that pass their initial screening than on the initial screening stage itself. Learning from other investors is important.

    Item type: Conference or Workshop Item (Paper)
    ID code: 28056
    Keywords: Business angels, learning, investment decision-making, verbal protocol analysis, Commerce
    Subjects: Social Sciences > Commerce
    Department: Strathclyde Business School > Hunter Centre For Entrepreneurship
    Related URLs:
      Depositing user: Miss Carol Ann Balloch
      Date Deposited: 13 Oct 2010 11:01
      Last modified: 12 Mar 2012 11:20
      URI: http://strathprints.strath.ac.uk/id/eprint/28056

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