Up to now, little attention has been paid to the continuity of a firm when entrepreneurs exit. Survey data from 175 entrepreneurs confirm the theory of planned behavior as an appropriate framework to understand whether entrepreneurs, when leaving, sell or liquidate their firm. Entrepreneurs' sale attitudes are related to sale intentions, which are associated with firm sale. Further, sale attitudes are positively related to whether entrepreneurs perceive firm continuation to be out of free will, their experience, the number of employees, and whether the firm is a multigeneration family business.
The study of trust-related outcomes has had a long tradition in the organizational literature. However, few have considered potential darker sides of trust or have explored its effects in the setting of entrepreneurial ventures. This study does so by examining how perceptions of entrepreneurs and angel investors concerning the degree of trust in their relationship impact the latter’s assessments of venture performance. Hypotheses are tested using survey data from the lead entrepreneur and angel investor of 54 ventures. Results indicate that angel investors evaluate portfolio company performance more positively when they perceive high trust, whereas entrepreneurs’ trust perceptions are negatively associated with angel investors’ assessments of venture performance. Further, these effects are partially mediated by the quality of information exchanges between both parties. Together, these findings point to the benefits as well as threats that come with the presence of strong trust in entrepreneur–angel investor relationships.
This paper examines how angel investors' human capital affects the valuation of their portfolio companies, based on the pre-money valuation of 123 investment rounds in 58 Belgian companies. We argue that angel investors with higher levels of human capital will perceive a higher value-creating potential in entrepreneurial opportunities through their ability to see more value-creating options, a higher value-adding potential post-investment and an enhanced legitimacy provided to the venture. Economic theories suggest they appropriate these rents through lower valuations, while stewardship theory suggests they share value creation with entrepreneurs. Consistent with stewardship theory, we show angel investors negotiate higher valuations when they have higher levels of human capital, more specifically if they studied longer, have a business degree, more entrepreneurial experience or previous professional law experience. As such, our results contrast with the behaviour of venture capital investors who negotiate lower valuations when they have more experience.
Export search results
The export option will allow you to export the current search results of the entered query to a file. Different
formats are available for download. To export the items, click on the button corresponding with the preferred download format.
By default, clicking on the export buttons will result in a download of the allowed maximum amount of items.
To select a subset of the search results, click "Selective Export" button and make a selection of the items you want to export.
The amount of items that can be exported at once is similarly restricted as the full export.
After making a selection, click one of the export format buttons. The amount of items that will be exported is indicated in the bubble next to export format.