Business Angel Investment, Public Innovation Funding and Firm Growth

Jyrki Ali-Yrkkö, Mika Pajarinen and Ilkka Ylhäinen

No 97, ETLA Reports from The Research Institute of the Finnish Economy

Abstract: Abstract In recent years, business angels have invested in a few hundred Finnish firms annually. The target firms are mainly young and small: 75% of them employ fewer than 10 workers and are less than 8 years old. These firms are most likely to be found in the ICT and professional service industries and manufacturing. Although many angel-funded firms have faster employment growth compared to matched nonfunded firms, the average growth rates do not significantly differ when we control for receiving public innovation funding and other firm characteristics. As many as 75% of the firms funded by business angels have also received public innovation funding in some phase, and 57% have received it before angel funding. However, no robust indication was found that combining these two sources of funds would give an extra boost to growth.

Keywords: Business angels; Innovation subsidies; R&D; Firm growth (search for similar items in EconPapers)
JEL-codes: D22 G24 G30 L53 O31 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2019-12-04
New Economics Papers: this item is included in nep-bec, nep-cse, nep-ent, nep-eur, nep-ict, nep-ino, nep-sbm and nep-tid
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