Does Angel Funding Help Startups?

If you are thinking of raising capital from a business angel, you probably want to know if getting that funding will help your business. More specifically, you are likely interested in learning whether angel financing will benefit you enough to justify trading equity in your company for the investment. Unfortunately, academic research doesn't provide an answer. No study indicates how much of your company you should give up to obtain angel backing. A recent Harvard Business School working paper by William Kerr, Josh Lerner and Antoinette Schoar examines whether getting angel funding benefits start-ups. While the study provides suggestive evidence that it does, it can't rule out the alternative that it doesn't.

Provided by: American Express Topic: Project Management Date Added: May 2010 Format: HTML

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