Tag Archives: biotech

Angels Prove to be More Selective in 2015

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The angel investor market in 2015 had a slight increase in investment dollars and in deal size according to a new report from the Center for Venture Research (CVR) at the University of New Hampshire.

The State Science & Technology Institute provides the following analysis:

In The Angel Investor Market in 2015: A Buyers Market, CVR reports that total angel investments in 2015 were $24.6 billion – an increase of 1.9% over 2014. CVR also reported that the total number of entrepreneurial ventures that received angel funding in 2015 declined by 3.1% from 2014 – in total 71,110 start-ups received funding. The result of these two trends was larger deal sizes for 2015 – an increase of 5.1% from 2014. CVR concluded that these findings, combined with yield rates and valuations data, indicate that angels were selective in their investment behavior in 2015.

While CVR contends that the angel market was robust in 2015 – approximately $24.6 billion in investments – they also believe that the selectivity of angels and decrease in valuations over the last three years indicates a continuing market correction in valuations. Other findings include:

  • Software maintained its top sector position with 18% of total angel investments in 2015
  • Other key industries include Healthcare Services/Medical Devices and Equipment (16%), Biotech (13%), Industrial/Energy (11%), Retail (10.6%), and Media (9%)
  • Angel investments contributed to the creation of 270,2000 new jobs in the U.S. – 3.8 jobs per angel investment
  • The average angel deal size was $345,390
  • The average equity received was 14.89% with a deal valuation of $2.3 million
  • Angel investment in the seed and start-up stage (28% of deals) was largely unchanged from 2014 (25% of deals)
  • Fort-five percent of all angel deals were early stage investments (46% in 2014)
  • Expansion and late stage investments also remained consistent with regard to percentage of total deals

Interested in the health of Indiana’s tech community? Get involved in the new Indiana Technology and Innovation Council. First open discussion is August 9! Contact Mark Lawrance at mlawrance(at)indianachamber.com to learn more. 

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Venture Funding Sees a Shift

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A quarterly analysis best known as the MoneyTree Report dishes out the latest on venture capital investment and the like. The good news from the second quarter review is that funding remained virtually the same (990 deals and $7.4 billion) as the first three months of 2008 (977 deals and $7.5 billion); the potentially ominous sign was less investment in early-stage companies and more in companies that are closer to commercialization and a payback.

Venture capitalists, like many others, are concerned about the economy. Fewer initial public offerings offer fewer opportunities for a return on that riskier early-stage investment. Money invested in companies seeking their first round of venture funds decreased 12%. Later-stage deals increased 14%.

Software and biotech led the way in number of deals. The big winner among industries, however, was clean technology with an all-time quarterly high of more than $883 million invested, including the top two deals of the quarter at $132 million and $115 million.

The National Venture Capital Association and PricewaterhouseCoopers analyze the numbers and distribute the report. It will be worth watching closely in the next few quarters.