Angel Investment Groups Increase Early Stage Pre-Money Valuations, Cut Round Sizes In 2012

KANSAS CITY, Mo., SANTA CLARA, Calif. and NEW YORK, Sept. 25, 2012 /PRNewswire/ --  The Angel Resource Institute (ARI), Silicon Valley Bank (SVB) and CB Insights released the latest edition of the Halo Report, a national survey of angel group investment activity, covering the first half of 2012 today.  

(Photo:  http://photos.prnewswire.com/prnh/20120925/SF80240-INFO)

Halo Report Highlights for 1H 2012, unless otherwise noted: ( Infographic)

• Pre-money valuations increased for pre-Series A deals by angel groups to $2.7 million in Q2, up from $2.5M in Q1, based on the trailing 12 months
• Median angel round sizes dropped 21% to $550K over 1H 2011, returning to 2010 round amounts
  • Median round size is $1.5M when angle groups co-invest with other investor types
• Internet companies received more total dollars than healthcare companies for the first time
  • 52% of angel group investments were in healthcare and internet companies combined
  • Internet companies received 34% of the angel group dollars
• The Southwest and Great Plains regions increased both share of deals and dollars over 1H 2011
• The most active angel groups (deals) were Tech Coast Angels, Central Texas Angel Network, Launchpad Venture Group, Golden Seeds, Sand Hill Angels, and Investors' Circle
• The biggest investors among angel groups (dollars) were Tech Coast Angels, Central Texas Angel Network, Sand Hill Angels, Golden Seeds,  Launchpad Venture Group, Alliance of Angels,
• Arizona Technology Investor Forum, Common Angels, Desert Angels and Atlanta Technology Angels

"The Halo Report sheds light on investing that is often critical to entrepreneurs' success, but very hard to track," said Robert Wiltbank, Vice Chair of Research for ARI. "With this data, entrepreneurs have a much better sense of how to interface with angel investors, and investors have a much better sense of 'the market.'"

"As more angels participate each quarter, we are identifying trends and practices that help entrepreneurs and investors make better decisions and to more effectively create great new companies," said Carrie Walsh, Managing Director for Silicon Valley Bank's Entrepreneur Services Group.

"Angel investors seem to be following a trend similar to the one we've witnessed recently in the venture capital market: Internet and Mobile are increasingly becoming attractive areas for investment while Healthcare is seeing its share decrease in terms of both deals and dollar," said Jonathan Sherry, Co-Founder of CB Insights.

Angel investors, those who invest their own funds and expertise directly into startup companies, appear to be taking on an increasingly important role in driving entrepreneurship throughout the United States.  Their investments are in startups and young companies, which have been cited by the Kauffman Foundation as the key source of net new jobs in the country.  Nationwide, these angel group investments have opened up new opportunities for centers of innovation and entrepreneurship. 

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