Drawing on signaling theory and using a certification lens, we examine how new ventures credibly communicate their underlying quality, using a unique dataset of 627 new ventures that sought investment from a prominent angel group located in the greater Boston, MA area during 2007-2010. Findings suggest that signals of quality are multi-dimensional, that they are more important when accompanied with a reliable referral, and that they are dynamic, with different types of signals mattering at different times in the angel investment decision-making process. Implications are discussed.
Edelman, Linda F.; Manolova, Tatiana S.; and Brush, Candida G.
"MAKING PROGRESS THROUGH THE ANGEL INVESTMENT PROCESS: THE EFFECT OF EXTERNAL CERTIFICATION,"
Frontiers of Entrepreneurship Research: Vol. 37
, Article 1.
Available at: https://digitalknowledge.babson.edu/fer/vol37/iss1/1