Business angels do not attract the attention from the business media that they deserve as the largest source of seed, start-up and early growth capital for ambitious entrepreneurs (for example, see the European Business Angel Market Statistics Compendium).
Craig Coben’s article “Being an angel is tougher than it looks” (Opinion, August 18) is therefore a welcome contribution. I offer some further observations based on 35 years of research on business angels.
First, the dominance of angels with backgrounds in finance is probably a London effect. Studies in various countries are consistent in indicating that the majority of business angels are successful, cashed-out entrepreneurs. Many are serial entrepreneurs.
Second, over the past three decades angel investing has become a collective activity, with many angels recognising the benefits of investing as part of managed angel groups. These include superior deal flow, portfolio diversification, the ability to invest in deals they could not do on their own, with the pooling of members’ expertise providing more effective evaluation of opportunities and more effective post-investment support, while still able to make their own investment decisions.
Third, making the investment decision is only the start of the investment process. Angels provide “smart money”, contributing their knowledge, skills and social capital to support the entrepreneurs they back.
Finally, angels invest for a mix of financial and non-financial motives. Joe Canavan, Canada’s 2025 Angel Investor of the Year, awarded by the National Angel Capital Organisation, has commented that by “being an angel investor . . . I’ve had the rare opportunity to work alongside some of Canada’s most passionate, creative and courageous entrepreneurs — people who are not only building new ideas and businesses but are also challenging the status quo and inspiring real change . . . Supporting them — whether through guidance, mentorship, or capital — feels, at times, like a merging of altruism and capitalism.
“When done right, it’s about more than just returns. It’s about nation-building, community and contribution.”
Colin Mason
Emeritus Professor of Entrepreneurship,
Honorary Senior Research Fellow
Adam Smith Business School,
University of Glasgow, Glasgow, UK
