The jockey on the horse : what makes a winning ride in the eyes of early-stage investors?

Svetek, Mojca (author), Drnovšek, Mateja (author)

To date, much of the research on early-stage equity investing has revolved around the question of whether early-stage equity investors place more importance on the entrepreneur (jockey) or the business opportunity (horse). Yet research has failed to agree on the relative importance of these two aspects of investment opportunity. The purpose of this study is to clarify how early-stage equity investors use available information about the entrepreneur and the business opportunity to make investment decisions. We analysed empirical data from semi-structured interviews with experienced early-stage equity investors active in Europe. In the analysis, we followed the twin slate approach, which accounts for literature review in the analytical process. Our results suggest that investors make sense of the business opportunity as a whole by integrating information about the entrepreneur and the business opportunity. We identified four aspects of early-stage investor decision-making that led us to conclude that investors’ evaluation of investment opportunities is holistic in nature. The study offers a number of practical implications for investors and entrepreneurs and enriches ongoing discussions about early-stage investors’ investment criteria.

• Language: English
• Keywords: enterprises, investments, decision making, angel investment, venture capital, investment criteria, investor decision-making, holistic thinking, cognitive style
• Work type: Article
• Typology: 1.01 - Original Scientific Article
• Organization: EF - School of Economics and Business
• Publication status: Published
• Publication version: Version of Record
• Year: 2022
• Number of pages: Str. 165–189
• Numbering: Vol. 29, no. 2
• PID: 20.500.12556/RUL-138763
• UDC: 658
• ISSN on article: 1321-5906
• DOI: 10.1080/13215906.2022.2092889
• COBISS.SI-ID: 117039363
• Publication date in RUL: 16.08.2022

Record is a part of a journal

• Title: Small enterprise research
• Publisher: Taylor & Francis
• ISSN: 1321-5906
• COBISS.SI-ID: 521629977

Licences

• License: CC BY-NC-ND 4.0, Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International
• Link: http://creativecommons.org/licenses/by-nc-nd/4.0/
• Description: The most restrictive Creative Commons license. This only allows people to download and share the work for no commercial gain and for no other purposes.

Secondary language

• Language: Slovenian
• Keywords: podjetje, investicije, odločanje