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Informal investors as entrepreneurs – the development of an entrepreneurial career

Politis, Diamanto LU and Landström, Hans LU (2002) In Venture Capital 4(2). p.77-101
Abstract
Informal investors have proved to be highly valuable for the growth of the firms in which they have invested. Therefore, it is important to understand what motivates potential informal investors to make their initial investment as well as how already active investors develop their entrepreneurial careers. Such an understanding may prove helpful in directing efforts to locate and attract potential and existing informal investors. This paper investigates the entrepreneurial career of four informal investors. Based on the personal stories of these individuals, we explore their career patterns and present the central concepts of the different career phases they have progressed through. The results indicate that informal investors have... (More)
Informal investors have proved to be highly valuable for the growth of the firms in which they have invested. Therefore, it is important to understand what motivates potential informal investors to make their initial investment as well as how already active investors develop their entrepreneurial careers. Such an understanding may prove helpful in directing efforts to locate and attract potential and existing informal investors. This paper investigates the entrepreneurial career of four informal investors. Based on the personal stories of these individuals, we explore their career patterns and present the central concepts of the different career phases they have progressed through. The results indicate that informal investors have experienced three overall career phases: (1) the corporate career phase; (2) the entrepreneurial learning phase; and (3) the integrated investment career phase. Each career phase provides informal investors with possibilities for learning and developing valuable competencies in order to advance in their entrepreneurial career. During the corporate career phase, the investors learn a 'managerial logic' and create a platform on which they can build up their managerial competence, establish a network, and legitimize their reputation. In the following entrepreneurial learning phase, the investors make use of this platform in varying entrepreneurial projects, mainly as consultants, which in turn provides them with the possibilities for learning the 'logic' behind entrepreneurial processes. During the integrated investment career phase, informal investors extend the platform by making use of their managerial and entrepreneurial competence in the firms in which they invest, and thus act as both entrepreneurs and informal investors in the firms in which they are involved. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
Entrepreneurial Career, Informal Venture Capital, Life Stories
in
Venture Capital
volume
4
issue
2
pages
77 - 101
publisher
Taylor & Francis
external identifiers
  • scopus:85011125937
ISSN
1369-1066
DOI
10.1080/13691060210816
language
English
LU publication?
yes
id
57f79a0c-50e3-43f4-b648-89db97b7800c (old id 3127900)
date added to LUP
2012-10-10 07:41:44
date last changed
2017-12-10 04:25:01
@article{57f79a0c-50e3-43f4-b648-89db97b7800c,
  abstract     = {Informal investors have proved to be highly valuable for the growth of the firms in which they have invested. Therefore, it is important to understand what motivates potential informal investors to make their initial investment as well as how already active investors develop their entrepreneurial careers. Such an understanding may prove helpful in directing efforts to locate and attract potential and existing informal investors. This paper investigates the entrepreneurial career of four informal investors. Based on the personal stories of these individuals, we explore their career patterns and present the central concepts of the different career phases they have progressed through. The results indicate that informal investors have experienced three overall career phases: (1) the corporate career phase; (2) the entrepreneurial learning phase; and (3) the integrated investment career phase. Each career phase provides informal investors with possibilities for learning and developing valuable competencies in order to advance in their entrepreneurial career. During the corporate career phase, the investors learn a 'managerial logic' and create a platform on which they can build up their managerial competence, establish a network, and legitimize their reputation. In the following entrepreneurial learning phase, the investors make use of this platform in varying entrepreneurial projects, mainly as consultants, which in turn provides them with the possibilities for learning the 'logic' behind entrepreneurial processes. During the integrated investment career phase, informal investors extend the platform by making use of their managerial and entrepreneurial competence in the firms in which they invest, and thus act as both entrepreneurs and informal investors in the firms in which they are involved.},
  author       = {Politis, Diamanto and Landström, Hans},
  issn         = {1369-1066},
  keyword      = {Entrepreneurial Career,Informal Venture Capital,Life Stories},
  language     = {eng},
  number       = {2},
  pages        = {77--101},
  publisher    = {Taylor & Francis},
  series       = {Venture Capital},
  title        = {Informal investors as entrepreneurs – the development of an entrepreneurial career},
  url          = {http://dx.doi.org/10.1080/13691060210816},
  volume       = {4},
  year         = {2002},
}