“NACO” Report Recognizes Top Angel Groups in Canada, Highlights Key Investment Trends

The National Angel Capital Organization (“NACO”) just  released  its 2012 Report on Angel Investing Activity in Canada. The report focuses on the activities of NACO member Angel groups – the visible portion of Canada’s Angel market. "We are proud to be able to shine light on an asset class that acts as the backbone of Canadian entrepreneurs. The conclusions and analysis of this report will lead to sharing of best practices among NACO members, supporting increased returns for Angels, and increased benefits for Canada,” said NACO Chair, Michelle Scarborough. 

In 2012, groups reported investing a total of $40.5 million in 139 companies. Funded companies were primarily in one of the top three sectors, which continue to be Information and Communication Technology ($17.9 million), Life Sciences ($7.5 million) and Clean Technology ($3.2 million). “We are excited about the unique opportunity to provide insights into Angel investing activity in Canada. This information helps our members make more informed investment decisions and provides a basis for the development of public policy in support of high growth Canadian companies,” said Yuri Navarro, NACO Executive Director. 

New to this year’s report, NACO also captured information about government leveraging of Angel investments. While the majority of reported investments included government support, some programs stood out, such as FedDev Ontario’s Investing in Business Innovation program.

Since 2010, the report has captured 361 investments, representing $158.2 million injected in the Canadian entrepreneurial ecosystem by visible Canadian Angel investors. “The NACO report provides key insights into how Angel investors are supporting the Canadian economy [and] … shows that Angels are increasingly important for financing Canada’s most innovative entrepreneurs,” said Thomas Hellmann, Professor at the Sauder School of Business (UBC) and Chair of the NACO Research Report Committee. 

Top  Angel Groups in Canada for 2012:

The Top 5 Angel Groups in 2012 by dollar amount invested:
1. Golden Triangle Angel Network
2. Angel One Network
3. Northern Ontario Angels
4. Capital Angel Network
5. VANTEC

The Top 5 Angel group in 2012 by number of investments made (T1 indicates that the first 3 groups are tied with an equal number of investments):
T1 Angel One Network
T1 Northern Ontario Angels
T1 Capital Angel Network
4. Golden Triangle Angel Network
5. WUTIF Capital

Key points from the 2012 survey are summarized below:

• 75% of Angel groups have been established within the last five years (since 2007).

• The majority of groups operate on the basis of individual members making their own investment decisions.

• The number of Angel groups in Canada continues to fluctuate with two groups disbanding in 2012.

• The size of Angel groups is increasing:

     -45% of Angel groups have fewer than 50 members (compared to 70% in 2011).

      -30% of Angel groups had between one and 10 members making investments in 2012 (compared to 60% in 2011).

      -20% of Angel groups had between 51 and 100 active members (a 16% increase compared to 4% in 2011).

• 70% of Angel groups indicated that they received more than 50 business plans in 2012.

In 2012, there were 139 investments reported (102 new, 30 follow-on, and 7 unreported) totalling $40.5M ($28.9M new, $7.3M follow on

and another $4.3M aggregated).  This represents a 96% increase in the

number of investments and a 13% increase in the total value of investments from 2011 to 2012.

• For the deals that were reported, the mean company valuation was $2.063M and the median company valuation was $1.550M2.

• The highest level of reported activity was done by Angel groups based in Central Canada, which were responsible for $33.4M or 82% of total investments.

• Information and Communications Technology ($17.9M), Life Sciences ($7.5M), and Clean Technology ($3.2M) continue to be the top three

sectors by investment value in Canada.

• 55% of recorded investments involved a coinvestor.

• The majority of the reported investments leveraged government support.

About the National Angel Capital Organization

The National Angel Capital Organization (“NACO”) accelerates a thriving, early-stage investing ecosystem in Canada by connecting individuals, groups, and other partners that support Angel-stage investing. NACO provides intelligence, tools and resources for its members; facilitates key connections across borders and industries; and advocates for Angel asset-class issues. For more information  visit www.nacocanada.com.

Subscribe to the Angel Investing News