Abstract

In this paper we develop a theory of women’s angel investing based on four factors that influence women’s participation in the angel investment market. First, women may have a lower propensity for risk (or at least may so perceive themselves) and a more conservative attitude to investment, reflected in different patterns of investment activity. Second, homophily limits social worlds, and as women are in different social networks than men with different access to social capital, their investment activity will differ. Third, business angel activity is a male-dominated activity: research into competition and performance in heteronormative environments suggests that women perform less well than in single-sex environments, which would be reflected in lower participation in angel investing through mixed-sex groups. Fourth, there may be a ‘glass wall’ effect, preventing a woman from moving to a position that has a promotional ladder by attenuation of career diversity and skill development and exclusion from networks and groups. For women would-be investors, less diverse career tracks and lower levels of entrepreneurial backgrounds will be reflected in lower investment levels.

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