US angel funding increases

According to a study published by the Centre for Venture Research, angel funding in the US  increased again in 2013, continuing its upwards trend that began in 2010. The increase occurred both in dollars invested and number of start-ups receiving angel funding.

A total of 70,730 entrepreneurial ventures received angel funding in 2013, an increase of 5.5% over 2012 investments, and the number of active investors was 298,800, an increase of 11.4% from 2012. Angels increased their investments in the seed and start-up stage, with 45% of 2013 angel investments in the seed and start-up stage, up from 35% in 2012. Angels also exhibited an increased interest in early stage investing with 41% of investments in the early stage, up from 33% in 2012.

Total investments in 2013 were $24.8bn, an increase of 8.3% over 2012. This amount is close to the market high of $26bn which occurred in 2007. The size of individual investments however decreased, from an average $85,435 in 2012 to $83,050 in 2013, or 2.3%.

At the top of the list for angel investments was software with 23% of total angel investments in 2013, followed by social media and applications at 16%, healthcare services, medical devices and equipment at 14%, biotech at 11%, retail at 7%, and financial services also at 7%. Of particular note here is the increased interested in media investments, which was only in sixth place in 2012.

Data on angel investments in individual cities or at universities was not made available as part of the study.

Jeffrey Sohl, director of the Centre for Venture Research, said: “This increase in the seed and start-up stage is an encouraging sign since seed capital is the stage of need for our nation’s entrepreneurs.”