SCORE, – www.score.org – mentors to America’s small businesses, has gathered statistics concerning how much and how often angel investors provide financing to small businesses, which industries receive the most investment and what characteristics comprise the “typical” angel investor.
More Angels Give Less Funding, More Often
According to data presented visually in the infographic, angel investors as a whole give less funding than venture capitalists, but do so more often:
- Angels invest $23B while venture capitalists invest $27B.
- The population of angel investors is comprised of 268K individuals while venture capital as a whole is made up of 522 active firms.
- 67,000 deals are done by angel investors while 3,700 are done by venture capitalists.
Software Industry Receives Most Angel Financing
The first London Value Investor Conference was held in April 2012 and it has since grown to become the largest gathering of Value Investors in Europe, bringing together some of the best investors every year. At this year’s conference, held on May 19th, Simon Brewer, the former CIO of Morgan Stanley and Senior Adviser to Read More
The industry receiving the most angel funding is Software (23%) followed by Healthcare (14%), Biotech (11%), Media (11%), Retail (7%) and Financial Services (7%). Miscellaneous/other industries represent 22% of angel funding.
The Typical Angel Investor
The typical angel investor is a successful entrepreneur investing their personal money in businesses close to home. They judge potential investments primarily by ROI (return on investment) and 26% ROI is the average annual return. On average, 3 of 10 considered deals are accepted. While 18% of angel investors are women and 4% are minorities, 16% of entrepreneurs seeking capital are women and 7% are minorities. Of those entrepreneurs that do receive funding, 18% are women and 15% are minorities.
How Angel Investors Fund Small Businesses, Who They Are?