Angel Group Update, 3Q 2015 - The Venture Alley · •TX, CA & NY boast multiple angel groups on the list of most active groups. ... angel investing for the general public. More information

Angel Group Update, 3Q 2015

Presents the

Table of Contents

3Q 2015 Highlights, p. 3

National Trends, p.5

Most Active Angels, p. 9

Regional Trends, p. 12

Sector Trends, p. 15

About the Halo Report, p. 18

3Q 2015 Highlights

Highlights •Angel only round sizes jump in 3Q 2015.

–Median up 45% from 2Q 2015 report.

•Median seed pre-money valuation increases to $4M in 2015 thru 3Q

–33% increase from 2014, highest valuation in the Halo Report to date.

•TX, CA & NY boast multiple angel groups on the list of most active groups.

•Software sector continues to be the top industry by deal flow, while healthcare

is expanding its share of dollars.

Halo Report 3Q 2015

National Trends

Median and Mean Round Sizes – Angels Only 2015 Shows Round Sizes Steadily Increasing Quarter Over Quarter

$350k $360k

$500k $500k

$725k

$767k

$606k

$1.20M

$735k

$1.41M

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

$1.2

$1.4

$1.6

3Q 4Q 1Q 2Q 3Q

2014 2015

Mil

lio

ns

USD

Median Round Size Mean Round Size

Median and Mean Round Sizes – Angel Co-Investments Rounds Also Trending Up When Angel Groups Co-Invest With Non-Angels

$1.10M

$1.50M

$1.20M

$1.55M $1.71M

$1.96M

$2.80M

$2.38M

$3.09M

$3.51M

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

3Q 4Q 1Q 2Q 3Q

2014 2015

Mil

lio

ns

USD

Median Round Size Mean Round Size

Median Seed Stage Pre-Money Valuation Median Valuation Up 33% From 2014, Highest Ever Valuation In HALO Report

$0.12M

$15.0M

MEDIAN :

$4.0M

3rd Quartile:

$6.5M

1st Quartile:

$2.5M

$12.8M

3rd Quartile:

$6.3M

$3.0M MEDIAN :

1st Quartile:

$2.0M

$0.90M

2014 2015 Thru 3Q

Active Angel Groups

Most Active Angel Groups 2015 Thru 3Q – Total Deals

Data sourced from

Most Active Angel Groups 2015 thru 3Q – Total Number of Deals

Total Deals 2015 (descending order)

• Tech Coast Angels

• Houston Angel Network

• Central Texas Angel Network

• Alliance of Angels

• New York Angels

• Wisconsin Investment Partners

• Sand Hill Angels

• Keiretsu Forum

• Queen City Angels

• Launchpad Venture Group

• Golden Seeds

• Maine Angels

Regional Trends

2015 Thru 3Q Share of Angel Group Deals by Region:

California

21.1%

Northwest

6.9%

Southwest

9.1%

Great Plains

3.9%

Great Lakes

12.9%

Southeast

9.1%

Mid-Atlantic

5.2%

New England

12.1%

Texas

11.2%

New York

8.6%

Northwest

4.1%

Southwest

7.5%

Great Plains

2.5%

Great Lakes

14.5%

Southeast

13.8%

Mid-Atlantic

3.4%

New England

15.5%

Texas

9.7%

New York

9.8%

California

19.7%

2015 Thru 3Q Share of Angel Group Dollars by Region:

Sector Trends

Quarterly Share of Angel Group Deals by Sector Software continues as top industry by deal flow

23.3% 19.4% 23.0% 20.3% 20.8%

2.3% 3.0% 2.5%

2.3%

6.0%

3.0%

3.8%

10.5%

4.5%

10.0%

3.8% 3.8%

5.8%

4.5% 1.3%

5.7%

2.3%

6.0% 6.0%

5.1% 1.9%

9.3% 11.9%

13.0%

19.0% 17.0%

7.0% 10.4% 9.0%

8.9% 11.3%

37.2% 37.3% 33.0%

38.0% 35.8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

3Q 4Q 1Q 2Q 3Q

2014 2015

Software

Commercial Services

Healthcare Svcs/Suppl./Syst.

Media

Consumer Goods & Recreation

Pharma & Biotech

IT Hardware

Energy

Other

Quarterly Share of Angel Group Dollars by Sector Internet & Healthcare Alone Account for 50% of Invested Capital in Past 5 Quarters

21.3% 27.6%

23.2% 30.0%

25.5%

3.6% 3.5%

4.6% 3.6% 0.7%

2.6%

18.3% 7.6% 16.9% 1.2% 4.2%

3.9%

1.9% 5.4%

0.1%

2.8%

8.0% 5.4%

15.7% 17.1%

16.6% 24.3%

30.0%

0.9% 12.0%

13.5% 8.7% 15.3%

36.1% 27.4%

17.6% 20.5% 22.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

3Q 4Q 1Q 2Q 3Q

2014 2015

Software

Commercial Services

Healthcare Svcs/Suppl./Syst.

Media

Consumer Goods & Recreation

Pharma & Biotech

IT Hardware

Energy

Other

0.3%

About the Halo Report™

Understanding the Data: Special Round Types and Industry Sectors

The HALO Report™ provides analysis and trends on US angel and angel group activity.

Angels and angel groups invest alone, together, and with many other types of investors. Unless otherwise noted the HALO Report™ data includes all rounds that have at least one angel group participating and may include other types of investors in those rounds.

A few charts report on an “Angel Round,” a special classification of investment when angel groups invest alone or only with other angels and angel groups.

Unless otherwise noted, values of less than 1% in the industry sectors are included, but are not labeled directly.

Internet

Mobile & Telecom

Software

Energy & Utilities

Computer Hardware & Services

Healthcare

Industrial

Automotive & Transportation

Business Products & Services

Consumer Products & Services

Electronics

Environmental Services &

Equipment

Financial Services

Food & Beverages

Leisure

Media

Metals & Mining

Retail

Risk & Security

HALO Report™ Industry Sectors

Angel Resource Institute at Willamette University Katie Hamburg, [email protected] The Angel Resource Institute (ARI) is a 501(c)(3)charitable organization devoted to education, mentoring and research in the field of angel investing, housed at Willamette University. ARI was founded by the Ewing Marion Kauffman Foundation, and is a sister organization of the Angel Capital Association, the professional association of angel groups in North America. The programs of ARI include educational workshops and seminars, research projects and reports, and information about angel investing for the general public. More information is available at: www.angelresourceinstitute.org

PitchBook PitchBook is an impartial private equity and venture capital research firm that provides premium data, news and analysis. Through a combination of publicly available sources and rigorous firsthand research with industry professionals, PitchBook has developed an extensive database with in-depth information and statistics on hundreds of thousands of companies, deals, investors, service providers and limited partners.

Willamette University MBA Willamette University MBA is a leader in early stage investment research and entrepreneurship. In addition to being the

home of the Angel Resource Institute, Willamette launched the world’s first student run angel investment fund in 2008. Willamette faculty and researchers published the world’s largest and most cited study on angel investor returns, Returns to Angel Investors in Groups (2007), and one of the most widely used textbooks on entrepreneurship, Effectual Entrepreneurship (2011). They also perform data analysis for the HALO Report.

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