Business Angels Funding Startups in Morocco

Abstract

Some people are funding businesses being started by others, although most people are not. What kinds of people are likely to fund startups; which background attributes such as gender, age, education, and income promote investing? Investing, moreover, occurs in the context of a region and its institutions. Which regions promote investing, and how do their local institutions affect investing? These questions are addressed by a survey of a representative sample of 13,956 adults in the areas of Morocco, asking about their background and investing, combined with data on institutions in their regions. We find that being male, older, educated, and rich promotes investing. However, background effects differ from region to region, depending on local institutions. Notably, a culture of risk-willingness in a region reinforces wealthy people's inclination to invest and enhances less educated people's propensity to invest. These findings contribute to contextualizing business angels' endeavors as embedded in regional ecosystems.