UNH center finds more angels invested in more deals, but at smaller amounts in 2018

Total dollars fell, but number of ventures receiving funding rose

The angel investor market in 2018 resulted in an increase in market participation in more companies, but the total amount of money invested decreased, according to the latest angel market analysis by the Center for Venture Research at the University of New Hampshire.

Total investments in 2018 were $23.1 billion, a decrease of 3.4% from 2017, but 66,110 entrepreneurial ventures received angel funding, an increase of 7.4% over 2017. The number of active investors in 2018 rose to 334,565 individuals, an increase of 16%, according to the center.

“The change in total dollars and the number of investments resulted in a deal size for 2018 that was smaller than in 2017, reflecting lower valuations,” said Jeffrey Sohl, director of the center. “The increase in number of investments likely offsets a decline in activity by institutional investors in seed and start-up deals and the smaller deal size may have partially contributed to the increase in angel investors.”

According to the center’s analysis, angel investments in the seed and startup stage totaled 34% of investments in 2018, a decrease of 7%, but angels increased their interest in expansion state companies.

“This increase in expansion financing indicates that angels were concerned with building a longer runway for their investments, but this came at the expense of investments in the next generation of ventures, as indicated by the decrease in seed and start-up stage investments,” said Sohl.

In addition, angel investments continue to be a significant contributor to job growth with the creation of 251,200 new jobs in the United States in 2018, according to the center’s report.