International Trends in Angel Investing
Here are the reflections from the team that headed to Australia for their Angel Conference, it was an excellent occasion in our view, and it seems they have come a long way. The thing that stuck out for me, a part from the 150 attendees was the stories on exits and also the fantastic international speakers they had from US, Canada and Europe.
On behalf of Norman, Dean, Chris, Andy and Bill The Honorary Kiwi
International Trends in Angel Investing:
- No-one has found the funding model that works
- VC model continues to be challenged, and will be for some time. It seems the situations are the same in Australia, NZ and even the US, limited partners are fed up.
- But angel syndication has allowed angel to move closer to filling the void of VC and this seems to be extremely important for New Zealand
- Funding model therefore means, smaller amount of capital invested into companies, although we will need to do further work to understand implications/effect on companies
- Given the changed market conditions, this has significant implications on funding strategies and in particular commercialisation of R&D from Uni’s and RIs
- More and more US angels are now doing ‘angel only deals’, as opposed to ‘teeing the deal up’ for VCs
- Angel investment is now a key asset class and the story needs to be told better – for example, in the US we are talking the same amount of money invested by probably 10x more deals invested by angels, leading to significant job growth
- World-wide, commercialisation of University and Research Institute IP continues to be very challenging – the UniQuest Model looked interesting and had good feedback from Angels ie they liked it
- Industry data is absolutely critical internationally
- Mega Angel trend happening which is leading cross-border activity in the UK and Canada, but not the US at this stage …
- Syndication, cross border is significantly helping angel backed companies enter markets although while there is a lot of ‘talk’ about cross-border investing, there appears to be little evidence of volume of deals. Those reported transactions tend to be in regions of close proximity ie Seattle/Vancouver and France/Switzerland
From Andy Hamilton