As suppliers of critical risk capital, angels are routinely faced with a multitude of investment opportunities and typically invest in less than 20% of these prospects. Angels need to access these opportunities, decide which investments to pursue, and try to predict future winners and losers all within an environment typified by a high degree of information asymmetry. This research examines the real-time actions and decisions of angel investors and the effect of the investment regret or inaction on future investment decision-making. Angels who missed a past opportunity that subsequently realized a positive return are significantly less likely to invest in subsequent similar opportunities. Also, the dynamism of the market and the experience of the investor play important roles in influencing subsequent investment decisions once an investor has missed an opportunity. This research adds a level of granularity by identifying a new and potentially influential dimension—missed opportunities are an influential force in angel investment decision-making.
