Abstract

The current stock of knowledge regarding business angels or informal venture capital investors has been derived from convenience samples composed of business introduction services (BIS), business angel networks (BAN), snowball samples, business service association lists and other methods of convenience. However, angels who belong to BANs and BISs represent only the tip of the iceberg as regards the total population of angels. Because of the unusual samples associated with business angel research, the academy has been advised to acknowledge the biases associated with samples of networked angels. It is expected that findings from BAN-sampled studies should differ from a more representatively sampled group of angels, but no empirical studies have been undertaken to assess the magnitude and direction of these variances. This study uses information asymmetry and social network theory to advance propositions regarding the direction of variances between BAN-sampled angels and those sampled more representatively. Hypotheses are advanced regarding the differences as regards their investment motivations, their deal generation activities and cognition.

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