Entrepreneurial Firms and Bank Financing: Do Business Angels Play a Role?

Vincenzo Capizzi; Nicola Carta; Elisa Cavezzali; Ugo Rigoni

doi:10.1111/eufm.12537

Entrepreneurial Firms and Bank Financing: Do Business Angels Play a Role?

Vincenzo Capizzi
, Nicola Carta
, Elisa Cavezzali
, Ugo Rigoni

Dipartimento di Studi per l'Economia e l'Impresa

Risultato della ricerca: Contributo su rivista › Articolo in rivista › peer review

Abstract

This paper investigates the contribution provided by business angels' (BAs) post-investment intervention to the interaction between young entrepreneurial firms and bank lending decisions within the entrepreneurial finance ecosystem. The analysis relies on a data set comprising 114 Italian BA-backed firms over the 2010–2018 period, alongside 498 matched firms. We find evidence that BAs' support makes it easier for entrepreneurial firms to raise follow-on bank financing. Additionally, we document the positive effects of both BAs' entrepreneurial experience and soft monitoring. These effects can be attributed to BAs' value-added contributions and their role in mitigating information asymmetries perceived by debt providers.

Lingua originale	Inglese
pagine (da-a)	1217-1245
Numero di pagine	29
Rivista	European Financial Management
Volume	31
Numero di pubblicazione	3
DOI	https://doi.org/10.1111/eufm.12537
Stato di pubblicazione	Pubblicato - giu 2025

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10.1111/eufm.12537

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title = "Entrepreneurial Firms and Bank Financing: Do Business Angels Play a Role?",

abstract = "This paper investigates the contribution provided by business angels' (BAs) post-investment intervention to the interaction between young entrepreneurial firms and bank lending decisions within the entrepreneurial finance ecosystem. The analysis relies on a data set comprising 114 Italian BA-backed firms over the 2010–2018 period, alongside 498 matched firms. We find evidence that BAs' support makes it easier for entrepreneurial firms to raise follow-on bank financing. Additionally, we document the positive effects of both BAs' entrepreneurial experience and soft monitoring. These effects can be attributed to BAs' value-added contributions and their role in mitigating information asymmetries perceived by debt providers.",

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author = "Vincenzo Capizzi and Nicola Carta and Elisa Cavezzali and Ugo Rigoni",

note = "Publisher Copyright: {\textcopyright} 2024 The Author(s). European Financial Management published by John Wiley \& Sons Ltd.",

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doi = "10.1111/eufm.12537",

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AU - Capizzi, Vincenzo

AU - Carta, Nicola

AU - Cavezzali, Elisa

AU - Rigoni, Ugo

PY - 2025/6

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N2 - This paper investigates the contribution provided by business angels' (BAs) post-investment intervention to the interaction between young entrepreneurial firms and bank lending decisions within the entrepreneurial finance ecosystem. The analysis relies on a data set comprising 114 Italian BA-backed firms over the 2010–2018 period, alongside 498 matched firms. We find evidence that BAs' support makes it easier for entrepreneurial firms to raise follow-on bank financing. Additionally, we document the positive effects of both BAs' entrepreneurial experience and soft monitoring. These effects can be attributed to BAs' value-added contributions and their role in mitigating information asymmetries perceived by debt providers.

AB - This paper investigates the contribution provided by business angels' (BAs) post-investment intervention to the interaction between young entrepreneurial firms and bank lending decisions within the entrepreneurial finance ecosystem. The analysis relies on a data set comprising 114 Italian BA-backed firms over the 2010–2018 period, alongside 498 matched firms. We find evidence that BAs' support makes it easier for entrepreneurial firms to raise follow-on bank financing. Additionally, we document the positive effects of both BAs' entrepreneurial experience and soft monitoring. These effects can be attributed to BAs' value-added contributions and their role in mitigating information asymmetries perceived by debt providers.

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KW - entrepreneurial finance

KW - new firms

KW - value-added

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Entrepreneurial Firms and Bank Financing: Do Business Angels Play a Role?

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