Determinants of long-distance investing by business angels in the UK

Richard Harrison, Colin Mason, Paul Robson

Research output: Contribution to journalArticlepeer-review


The business angel market is usually identified as a local market, and the
proximity of an investment has been shown to be key in the angel’s
investment preferences and an important filter at the screening stage of the
investment decision. This is generally explained by the personal and
localized networks used to identify potential investments, the hands-on
involvement of the investor and the desire to minimize risk. However, a
significant minority of investments are long distance. This paper is based on
data from 373 investments made by 109 UK business angels. We classify
the location of investments into three groups: local investments (those
made within the same county or in adjacent counties); intermediate
investments (those made in counties adjacent to the ‘local’ counties); and
long-distance investments (those made beyond this range). Using ordered
logit analysis the paper develops and tests a number of hypotheses that
relate long-distance investment to investment characteristics and investor
characteristics. The paper concludes by drawing out the implications for
entrepreneurs seeking business angel finance in investment-deficient
regions, business angel networks seeking to match investors to entrepreneurs
and firms (which are normally their primary clients), and for policymakers
responsible for local and regional economic development.
Original languageEnglish
Pages (from-to)113-137
JournalEntrepreneurship and Regional Development
Issue number2
Publication statusPublished - 2010


  • business angels
  • informal investment
  • distance
  • regional development
  • venture creation

Fingerprint Dive into the research topics of 'Determinants of long-distance investing by business angels in the UK'. Together they form a unique fingerprint.

Cite this