Angel Capital

Raising Equity Capital For Your New Business

Angel Capital / Angel Investors Raising capital for your new business

Overview of Angel Investors:

Recent Statistics

The following was complied by Judd Hollas of EquityNet.com:

There are more than 2 million Angel Investors who control [roughly] $1 trillion in capital.

Angel Investors:

• U.S. Angels invest a total of around $20 billion per year in around 60,000 businesses.
• Angels invest in around 1 out of every 10 business investment deals considered, or 10%.
• The average Angel Investor is 47 years old, college educated, and self employed (or has been self-employed).
• The average angel investor has an annual income of $90,000, a net worth of $750,000, and invests $37,000 per venture. (Angels rarely invest more than a few hundred thousand dollars in a venture.)
• 9 out of 10 angel investments are devoted to start-ups with fewer than 20 employees, and 7 out of 10 angel investments are made locally (within 50 miles of the Angel's home).
• 9 out of 10 angels provide additional support via personal loans or loan guarantees to the firms in which they invest.
• Angels expect a 26% average annual return at the time they invest - and expect about one-third of their investments to result in a substantial capital loss.
• Angels spend an average of 3.5 months conducting due diligence on each investment.
• The most common reasons angels reject deals are insufficient growth potential, overpriced equity, insufficient talent of the management, or lack of information about the entrepreneur or key personnel.

Click Here to see how Angel Capitalist compare to Venture Capitalists.

Goes to show that while Angel capital might be a bit easier to obtain (less due diligence) and quicker to get, angel capitalist are still limited in the dollar amount that they are willing or able to invest.

However, recently, many angel capital have been combining their investable capital in to pools (funds) and then managing those funds more similar to traditional venture capital funds. Thus, these super angels (groups / funds) may be able to over come this major limitation.

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