Angel investors prefer web companies

Investors in start up companies prefer web based software and services according to a recent survey by Angel Association New Zealand.

Angel investor’s preference for software companies is followed closely by technology hardware and equipment, then biotech and life-sciences.

Angel Association Chair, Phil McCaw said “around half of angel investors invest more than $30,000 on each deal, with twenty percent having up to $100,000 to spend.”

“Thirty percent of angels preferred deals involving $250,000 to $500,000 in the first round of funding being sought by a company. Investing in deals at concept stage with the product and market still needing validation was least popular. Investors prefer companies with a proven business model and some sales.”

“Angel investors bring expertise with their capital. Over a third of investors are prepared to roll up their sleeves and get deeply involved in preparing a venture for investment.

The Angel Association surveyed its members including those running seed funds and individuals who are members of formal networks. New Zealand has half a dozen managed funds investing in early stage ventures and approximately 200 angels belonging to networks based in Otago, Christchurch, Nelson, Wellington, the Manawatu, Tauranga and Auckland. A quarter of the members responded to the survey. Industry publication Young Company Finance reported the survey results in the March 2012 issue.

Angel investors have cumulatively invested $220 million into high-growth companies since 2006, in an average deal size of $540,000.

Contacts

Colin McKinnon, Executive Director, Angel Association New Zealand Incorporated
+64276406400
[email protected]

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