The purpose of my research is to examine the key motivational factors that affect the decision of Diaspora to invest in Armenia. The central question of this research is: How the wide range of institutional differences, the small size of the Armenian economy, and a weak business environment influence Diaspora participation in homeland development. The research question was answered through the study of two cases of Diaspora - Armenia cooperation and a survey that was conducted among members of Diaspora communities. My analysis yielded some very interesting and important results.