Halo Report - Angel Group Activity First Six Months (2012)
The Halo Report is a collaborative project between Silicon Valley Bank, Angel Resource Institute & data powered by CB Insights. This project highlights angel group investment activity and emerging trends throughout the United States and provides much sought after data that has not been previously available to entrepreneurs or early stage investors.
Valuations of angel-funded companies rose, but funding round sizes dropped some in the first half of the year.
Those were some of the findings from The Halo Report, a biannual survey of U.S. angel investments published today. The report, which covers the first half of this year, looks at details for 342 deals that drew $468 million of investment capital.
Overall, the study did not unearth any dramatic changes in the angel funding environment. It found that median pre-money valuations for angel-backed Series A deals rose a bit – to $2.7 million – in the twelve month period ending in the second quarter. That was up from $2.5 million in a comparable period ending the prior quarter.
The median round size, by comparison, dropped some from the heights reached in 2011, dipping back to 2010 levels. For the first half of this year, the median angel round size was $550,000 compared to $700,000 a year earlier.
Internet deals also grew in popularity, taking in just over a third of angel money invested in the first half of the year. Just over a quarter of angel investment dollars went to healthcare deals.
Deal distribution was more evenly geographically dispersed for angel deals then what one sees in the venture industry, where capital is concentrated in California and the Northeast. Angels backed an almost equal number of deals in California and the Great Plains region, for instance. (Though California still dominated in terms of dollars raised.) New England and the Southeast also captured an almost equal portion of deals.
"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.
The Halo Report includes aggregate analysis of investment activity by angels and angel groups and highlights trends in round sizes, location and industry preferences. The data is collected via survey and aggregation of public data using CB Insights innovative data analyses. The 1H 2012 Halo Report data is based on 342 deals totaling $467.7 million dollars invested.
PDF Document http://www.angelresourceinstitute.org/data/ACEF/DataProject/1H2012HaloReportFinal.pdf
SOURCE: Silicon Valley Bank; CB Insights; The Angel Resource Institute, PEHub.com