Noncontractual Governance Strategies of Business Angels in the Post-Investment Venture Relationship
2014 (English)Doctoral thesis, comprehensive summary (Other academic)
Business angels fulfil an important economic role in society by getting involved in early-stage ventures. This dissertation aspires to advance our knowledge of the governance strategies used by business angels in the venture relationship, based on the idea that the choice of governance strategies depends on the individual venture but is also shaped by the strategies adopted by any business angel network (BAN) the business angel is part of.
Major findings are twofold. First, the analysis suggests that governance strategies are role-contingent. The role of the business angel vis-a-vis the venture changes, typically from outsider to insider, as the relationship transitions through different stages. Business angels should only use governance strategies that are perceived as legitimate for their role. Moreover, all strategies do not mix well and some may even neutralize each other when used together. The impact of the BAN on the action of the individual business angel is not straightforward: the formalization of a BAN will certainly restrict individual action, but, on the other hand, it seems that the BAN can also be useful for managing conflicts.
Second, results indicate that conceptualizing the long-term dynamic of the investor-venture relationship in terms of any single theoretical perspective, be it agency theory, procedural justice, or norm-based influence, is too simplistic. The utility of each theoretical perspective is role-contingent: a business angel in the outsider role is better understood with agency theory, whereas a business angel in the insider role is better understood with norm-based influence theory.
The empirical data on individual business angels comes mainly from 30 interviews with 21 business angels, and some supplementary data. The analysis of BANs is made differently and based on a different data set consisting of approximately 150 interviews with BAN members, civil servants, politicians, banks, accountants, and entrepreneurs.
Place, publisher, year, edition, pages
Stockholm: KTH Royal Institute of Technology, 2014. , 93 p.
TRITA/KTH/CEFIN-DT, ISSN 1654-9376 ; 10
business angels, post-investment, relationship, governance, role contingency, mentoring, investor roles, venture
Research subject Business Studies
IdentifiersURN: urn:nbn:se:kth:diva-155318ISBN: 978-91-87111-01-3OAI: oai:DiVA.org:kth-155318DiVA: diva2:760722
2014-11-14, F3, Lindstedtsvägen 26, Stockholm, 15:00 (Swedish)
Gabrielsson, Jonas, Associate Professor
Berggren, Björn, Associate ProfessorGrünberg, Jaan, DoctorEriksson, Kent, Professor
QC 201411042014-11-042014-11-042014-11-04Bibliographically approved
List of papers