UNH report: Angel investments up 14% in 2010

The nation’s angel capitalists invested $20.1 billion in ventures in 2010 — an increase of 14 percent over 2009, according to data released by the Center for Venture Research at the University of New Hampshire.According to the center, a total of 61,900 entrepreneurial ventures received angel funding in 2010, an increase of 8.2 percent over 2009.Not only was more money invested, the size of deals increased, said Jeffrey Sohl, venture research center director at the Whittemore School of Business and Economics.”The significant increase in total dollars, coupled with the rise in the number of investments, resulted in a larger deal size – 5.4 percent larger – for 2010 compared with 2009. These data indicate that angels have significantly increased their investment activity and are committing more dollars resulting from higher valuations,” said Sohl.Health and medical devices had the most investments – 30 percent of total angel dollars in 2010, an increase of 2 percent from 2009 — followed by software (16 percent), biotech (15 percent), and industrial/energy ventures (8 percent).Continuing a trend, seed and start-up capital dwindled 4 percent in 2010 from 2009, making up 31 percent of total angel investments.”This decrease in seed/start-up stage and first sequence investing is of concern. However, as existing investments move to an exit and thus reduce the need for follow-on investments, it is anticipated that angel capital will become available for new seed stage investments,” said Sohl.The total number of active investors increased slightly to 265,400 in 2010, up just 2.3 percent from 2009, said Sohl.Angel investments created 370,000 new jobs in the United States in 2010, or six jobs per angel investment, according to Sohl.A copy of the report may be viewed at unh.edu/news/docs/2010angelanalysis.pdf. – CINDY KIBBE/NEW HAMPSHIRE BUSINESS REVIEW