Title
Alumni Networks in Entrepreneurial Financing
Publication Date
11-24-2021
Abstract
One in three deals in the early-stage financing market involves an investor and founder from the same alma mater. We show that founders' connections to early-stage investors through shared education networks are more important than school academic quality or shared geography in facilitating access to funding. Early-stage investors tilt their portfolios toward startups from their alma mater and place larger bets on these firms. Connected investments outperform the same investors' non-connected investments. Our results are stronger where information about founder abilities is likely less clear.
Document Type
Article
Keywords
Alumni networks, SAT scores, Startup financing, PitchBook, Innovation, Patents, IPOs, Acquisitions
Disciplines
Finance
DOI
10.2139/ssrn.3970128
Source
SMU Cox: Finance (Topic)
Language
English