Training Aspiring Entrepreneurs to Pitch Experienced Investors: Evidence from a Field Experiment in the United States

David Clingingsmith () and Scott Shane ()
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David Clingingsmith: Weatherhead School of Management, Case Western Reserve University, Cleveland, Ohio 44106
Scott Shane: Weatherhead School of Management, Case Western Reserve University, Cleveland, Ohio 44106

Management Science, 2018, vol. 64, issue 11, 5164-5179

Abstract: Accredited investors finance more than 75,000 U.S. startups annually. We explain how training aspiring entrepreneurs to pitch their new business ideas to these investors affects their odds of continued funding discussions. We model accredited investors’ decision to continue investigation as a real option whose value is a function of their experience and the information contained in the entrepreneurs’ pitches. We derive four hypotheses from the model, which we test through a field experiment that randomly assigns pitch training at four elevator pitch competitions. The data support all four hypotheses and are inconsistent with alternative explanations.

Keywords: pitching; startups; investment; training; experiment (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (8)

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