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Small Business Economics

Erschienen in:

25.01.2017

Business performance and angels presence: a fresh look from France 2008–2011

verfasst von: Nadine Levratto, Luc Tessier, Cecile Fonrouge

Erschienen in: Small Business Economics | Ausgabe 2/2018

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Abstract

Business angels enjoy a strong reputation for being more efficient than other investors among policy makers, practitioners, and scholars. However, due to the limited availability of specific financial data, previous research has barely assessed the impact of angels on companies’ performance. This paper seeks to bridge this gap by providing evidence from a unique dataset made up of 432 angel-backed French companies which are compared to two control groups, one randomly selected and another one consisting of similar enterprises. This double comparison process enables us to purge our analysis of structural effect and to demonstrate the importance of the methodology in generating the sample. Indeed, the results we obtain significantly differ depending on the control group. Our results show that the positive influence of angels depends on the condition of the comparison. The set of BA-backed companies is more likely to exhibit superior performance when it is compared to a random sample whereas the companies’ performance is either identical or worse when it is compared to a sample composed of k-nearest neighbors. In addition, using a quantile regression technique makes it possible to differentiate the effect of business angels based on the distribution of the value of the growth rate.

Vorheriger Artikel Affiliation ties and underwriter selection

Nächster Artikel Government as fund-of-fund and VC fund sponsors: effect on employment in portfolio companies

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The Resource online 1 presents some key figures of the different European markets.

Nadine Levratto and Luc Tessier are accreditated by the Statistical Confidentiality Committee (Comité du Secret Statistique), the French body that supervises access to data, for using the databases under strict confidentiality agreements. They are the only authors authorized to access the data.

It is named FARE (Fichier Approché de Résultats d’Entreprises).

We thank the members of France Angels for their support to this project and their willingness to share their data.

This subset has been composed using a SAS « CAHQUAL » procedure made available by the INSEE (1994). For a more detailed presentation of the SAS procedure used to compose this reference group, refer to online resource 3.

We adopted the second level of the Nomenclature of Units for Territorial Statistics (NUTS).

To define the industries, we adopt the French Classification system which is strictly equivalent to the European standard classification of productive economic activities (NACE). We took the second level, which consists of headings identified by a two-digit numerical code (divisions).

Small initial size means that large relative growth is easier to achieve with quite small absolute growth, whereas large initial size demands large absolute growth to achieve high relative growth.

Tables 5 and 6 contained in the online resource material present the estimation of the models determining employment and sales growth rates according to the length of the financial relationship.

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Titel: Business performance and angels presence: a fresh look from France 2008–2011
verfasst von: Nadine Levratto
Luc Tessier
Cecile Fonrouge
Publikationsdatum: 25.01.2017
Verlag: Springer US
Erschienen in: Small Business Economics / Ausgabe 2/2018
Print ISSN: 0921-898X
Elektronische ISSN: 1573-0913
DOI: https://doi.org/10.1007/s11187-016-9827-5

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