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Trends and Prospects in Venture and Angel Investments in New Media Companies


  • Stephen Prowse


How do 'new media' or Internet-related companies raise external equity capital? In this paper, I analyze two markets that entrepreneurs of private Internet-related businesses use in the US to raise equity: the venture capital market and the market for 'angel' capital. Both markets appear to be important sources of capital for private Internet-related firms. In this paper, I try to shed some light on how these markets operate with respect to investments in Internet-related companies. In particular, using data from PricewaterhouseCoopers' MoneyTree Survey, I analyze trends in venture capital investments in Internet-related companies and make comparisons with venture investments in non-Internet-related firms. In addition, I use information and data on the angel market to investigate how important the market for angel capital is likely to be as a source of capital for Internet-related businesses. In doing so I draw on ongoing and new research by myself and others into the operation of these markets. Finally, I make some cautious predictions about how the future prospects for raising money from these two sources are likely to evolve for Internet-related firms.

Suggested Citation

  • Stephen Prowse, 2001. "Trends and Prospects in Venture and Angel Investments in New Media Companies," Prometheus, Taylor & Francis Journals, vol. 19(1), pages 11-16.
  • Handle: RePEc:taf:promet:v:19:y:2001:i:1:p:11-16
    DOI: 10.1080/08109020110040851

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