Thursday, January 23, 2014

HALO Report shows Internet, healthcare and mobile companies receiving 81% of dollars invested by angel groups in Q3 2013




The Angel Resource Institute (ARI), Silicon Valley Bank (SVB) and CB Insights this week released the Q3 2013 Halo Report, a national survey of angel group investment activity, finding median round sizes down to $520K per deal, healthcare round sizes up, and a larger share of deals and investment dollars going to mobile companies. Together Internet, healthcare and mobile companies received 81% of dollars invested by angel groups in Q3.

The Great Lakes region in the US saw the largest increase in share of deals, and the biggest drop in share of dollars over Q2 2013. California-based angel groups retained the lead in the number of deals, and New England-based angels continued to invest the most during the quarter. US angel investment continues to be dispersed nationwide and, of the 10 most active angel groups in the quarter, Hyde Park Angels, Life Science Angels and Wisconsin Investment Partners are new to the list.

 “The big three – Internet, healthcare and mobile – continue to dominate the interest of angel groups, and we noticed a particular spike this year for healthcare companies,” said Rob Wiltbank, Vice Chairman of Research, Angel Resource Institute.  “Despite the downward trend in round sizes overall and the drop in total dollars into healthcare for the quarter, we noticed a significant jump in full year round sizes for the healthcare industry – a trend we’ll continue to watch.”

Halo Report Q3 2013 Highlights

Round Sizes: Median angel round sizes were still down for the second consecutive quarter at $520K, following a peak of $700K in Q1 2013 and three prior quarters of growth. When angel groups co-invest with other types of investors, the median round size is still trending higher to $2M in Q3 from $1.95M in Q2 and $1.4M in Q1.

Valuations: The most consistent finding in the report is median pre-money valuations in early-stage companies, which remain steady at $2.5M for the year.

Most Active Angel Groups: Based on total deals, the 10 most active angel groups in Q3 were (alphabetic order) Alliance of Angels, Golden Seeds, Houston Angel Network, Hyde Park Angels, Investors’ Circle, Launchpad, Life Science Angels, Sand Hill Angels, Tech Coast Angels, and Wisconsin Investment Partners.

Locations: Seventy-four percent of deals were completed in the angel groups’ home state in Q3, remaining consistent over the year.

Geography: Approximately one-third of all angel group deals consistently occur in California and New England, and the share of dollars invested in these regions increased over the prior quarter and year over year to 44% in Q3. The Great Lakes region saw the biggest gain in share of deals, and the biggest drop in share of dollars in the quarter with 14% of all deals and 5.3% of the dollars.

Sectors: Together, Internet, healthcare and mobile companies comprised an even higher percentage of angel group deals (76%) and received 81% of angel group dollars, an increase from Q2 and the prior year. Mobile companies saw the largest increase over other sectors in share of deals and dollars in Q3.

The Halo Report includes aggregate analysis of investment activity by angels and angel groups and highlights trends in round sizes, location and industry preferences. The data is collected via survey and aggregation of public data using CB Insights innovative data analyses. The Q3 2013 Halo Report data is based on 278 deals totaling $445 million in total rounds including co-investors.  The transaction details are available in the CB Insights subscription database for users to review and analyze themselves.  Academics may also access some of the data through ARI.

Sponsors of the Report are the Angel Resource Institute (ARI), a charitable organization devoted to education, mentoring and research in the field of angel investing; Silicon Valley Bank is the premier bank for technology, life science, cleantech, venture capital, private equity and premium wine businesses; and CB Insights, a National Science Foundation backed data as a service firm. 

For more information see also:

Two New Reports, Angel and VC Activity, Released this Week; Mobile is Where the Action Is

 

HALO Report Graphic Summarizes Angel Group Activity for Q3 2013

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Two New Reports, Angel and VC Activity, Released this Week; Mobile is Where the Action Is



 The  2013 Venture Capital Annual Report, covering  VC financing and exit trends, is released today by CB Insights, a respected venture capital database. Please note that this report does not include Angel Investing.   The most recent report on Angel Group investing, the Q3 2013 Halo Report, was also released this week.

Both studies report that Mobile is where the action is. For Angels, Mobile grabs a greater share of deals and dollars. For VCs, Q3 2013 was the first quarter of mobile funding greater than $1 billion; Q4 2013 saw an encore performance hitting $1.09B.

Healthcare round size jumps year over year for Angels. VCs had a big year for IPOs. While the tally for 2013 was up 55% vs 2012, the growth was driven exclusively by healthcare IPOs. VC backed M&A fared worse and actually fell 5% from 2012.

From the VC report:

·         Seed VC financing hits highest level in 5 years: 2013 saw $893 million invested across 843 seed VC deals. Seed VC deal sizes hit a four-year high in Q4  with the average hitting $1.5M and the median at $1.3M.

·         Most active investors: Andreessen Horowitz led the pack followed by 500 Startups, Google Ventures, New Enterprise Associates and Kleiner Perkins Caufield & Byers.

·         New York is here to stay: NY saw $2.94B in venture capital funding across 396 deals in 2013 - a five year high. Behind several large deals to Fab, MongoDB and Quirky, NY VC funding jumped 49% while deal levels jumped 12% on a year to year basis.

·         Massachusetts weakens: VCs deployed $3.04B across 318 deals to Massachusetts' companies in 2013. But whereas rival NY saw both funding and deals accelerate significantly in 2013, Mass. saw year over year funding and deals drop 1% and 5%, respectively. 

·         After huge exits, Washington state sees VC funding high in Q4 2013: WA had two of the biggest venture-backed exits in 2013 with Tableau and Zulily. The state also saw VCs pour more VC dollars in during Q4 than Q1 - Q3 2013 combined.

From the HALO Report:
  • Angel round size is still down from peak in early 2013
  • Median round size trending up to $2 million when angels co-invest
  • New England retains share of dollars; New York bounces back
  • Great Lakes shows biggest gains in share of deals, biggest drop in share of dollars
  • Based on total deals, the 10 most active angel groups in Q3 were (alphabetic order) Alliance of Angels, Golden Seeds, Houston Angel Network, Hyde Park Angels, Investors’ Circle, Launchpad, Life Science Angels, Sand Hill Angels, Tech Coast Angels and Wisconsin Investment Partners. - See more at: http://www.angelresource.org/research/halo-report.aspx#sthash.e7iLAKTS.dpuf
     Based on total deals, the 10 most active angel groups in Q3 were (alphabetic order) Alliance of Angels, Golden Seeds, Houston Angel Network, Hyde Park Angels, Investors’ Circle, Launchpad, Life Science Angels, Sand Hill Angels, Tech Coast Angels and Wisconsin Investment Partners.
One clear difference between the two groups is geographic.  VC activity is heavily concentrated on the two coasts, while seventy-three percent of angel group deals are now done outside California and New England.  A list of VC investments by state is included below. Should you be unable to view this table, the original can be found on Page 11 of the CB Insights Report.