Angel investors spread their wings

Angel investors spread their wings

Kiwi angel investment rebounded in the year to 30 June, with $36.5 million put into young companies compared with $30.9 million for the previous year, according to the latest Young Company Finance report.

This year there were 95 deals, last year there were 91. The levels for the 2012/2013 year are tracking back up towards the peak of $45.9 million recorded across 75 deals in 2009/2010.

In 2010/2011, $42 million was invested across 123 deals.

A total of $273.9 million has been invested in young companies by angels since the Young Company Finance Index began in 2006.

“Growing levels of membership in angel networks should see improvements in both the quantum of funding and also the numbers of angel deals receiving funding next year," says Angel Association chair Ray Thomson. "The increasing interest in the innovation sector is reflected by much greater media coverage this year and increased government interest, reflected by the formation of Callaghan Innovation. These are all helping to build a positive investment climate."

Of the $22.5 million invested in the last six months, 85 percent ($19.2 million) was follow-on investment.

“The higher proportion of funding going into follow-on rounds should be seen in a positive light," Thomson says. "Astute investors are only pouring more money in when ventures are meeting sales and revenue targets.

The first half of the year also saw 79 percent of deals syndicated between angel groups, the highest recorded syndication level.

Of the angel investment in young companies in 2012/2013, $3.1 million was seed investment, $12.7 million was in startups and $6.7 million at the early expansion stage.