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Aug 2
Angel Investor Tax Incentives Could be Very Bad
I've written a written more than one post in the past about states that are passing legislation to incentivise angel investors by giving them tax breaks and guaranteeing large portions of their investments.  Legislation encouraging angel investing has got to be a good thing, right?

Perhaps not.

Some leading angels who do not wish to make their stance public at this point believe that incentivising angel investors may lead to big trouble for investors, entrepreneurs and the U.S. economy.

If angels are given incentives to invest they may not be as thorough and/or choosy regarding with companies they invest in.  This may lead to a bubble of sorts, wherein a ton of jobs are created at companies that are destined to failure, no matter how much startup capital they raise.  Basically, angel investment incentives will encourage careless investing.

I'm not including all of the details here, but that's the basic gist of it.

What do you think?  Is there more to the argument than this?


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