Paper ID
2314
Paper Type
short
Description
Past research has explored the value of signals for early-stage ventures to indicate unobservable quality and future potential. Here affiliations with investors constitute especially salient signals in the form of “prestige capital” which imparts a valuable endorsement for ventures. However, previous studies have missed to examining how investors influence the strength of their own endorsement effect. We thus investigate how the use of social media to attain celebrity status, in turn, provides value-add to portfolio companies. In employing innovative matched-sample methods, we identify a significant effect of celebrity status on early-stage ventures’ ability to acquire resources. Thereby we add to previous literature on value-add and certification effects of investors by showing how the deliberate enhancement of endorsements signals translates into real economic value.
Recommended Citation
Woköck, Julian, "Business angel celebrities - How investors' social media signaling supports resource acquisition of early stage ventures" (2019). ICIS 2019 Proceedings. 10.
https://aisel.aisnet.org/icis2019/innov_entre/innov_entre/10
Business angel celebrities - How investors' social media signaling supports resource acquisition of early stage ventures
Past research has explored the value of signals for early-stage ventures to indicate unobservable quality and future potential. Here affiliations with investors constitute especially salient signals in the form of “prestige capital” which imparts a valuable endorsement for ventures. However, previous studies have missed to examining how investors influence the strength of their own endorsement effect. We thus investigate how the use of social media to attain celebrity status, in turn, provides value-add to portfolio companies. In employing innovative matched-sample methods, we identify a significant effect of celebrity status on early-stage ventures’ ability to acquire resources. Thereby we add to previous literature on value-add and certification effects of investors by showing how the deliberate enhancement of endorsements signals translates into real economic value.