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Following in the Footsteps of Others: Social Proof in Angel Groups

Author

Listed:
  • Henrik Wesemann Lekkas
  • Torben Antretter
  • Dean Shepherd
  • Joakim Wincent

Abstract

This study develops a theory of social proof in angel investing. We propose that availability bias leads angel group members to copy the highly visible decisions of new investors evaluating the same opportunity ( external social proof) and overlook the more insightful reinvestment decisions of prior investors ( internal social proof). We also theorize that more experienced investors generally herd less but selectively imitate knowledgeable investors from prior rounds. A study of investments by 469 angel group members and a vignette experiment with 367 participants support our hypotheses. Our findings contribute to research on social proof, decision-making under uncertainty, and investment experience.

Suggested Citation

  • Henrik Wesemann Lekkas & Torben Antretter & Dean Shepherd & Joakim Wincent, 2025. "Following in the Footsteps of Others: Social Proof in Angel Groups," Entrepreneurship Theory and Practice, , vol. 49(4), pages 1037-1070, July.
    • Handle: RePEc:sae:entthe:v:49:y:2025:i:4:p:1037-1070
    DOI: 10.1177/10422587251315657
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