Angel Investors Acting Like VCs
A Business Week article (thanks John and Steve!) discusses that angel investors are banding together more often and investing larger amounts in less risky deals. The author mentions that more than 200 organized angel groups exist in the U.S. served by the Angel Capital Association.
I like seeing the growth from the organized angel groups.
FundingUniverse.com (one of our portfolio companies) helps by providing free online software (the DealFlow Suite) to help angel groups find quality business plans and growing companies that they want to learn more about.
But I still think that the vast majority of angel investments are made by individuals who are not part of organized angel investor groups. I think the largest investments are made by superangels who don’t join groups and I think the majority of deals come from angels who aren’t trying to be like VCs–they are helping entrepreneurs that they know and like to try to get something off the ground. They invest anywhere from a few thousand dollars to hundreds of times that amount.
I know quite a few superangels. I wish more of them would join angel investor groups because sometimes angel groups can’t raise enough money to get good deals funded. Superangels could easily solve that problem.
Meanwhile, FundingUniverse.com now has more than 700 angel investors (20 state sites have at least 10) registered on its network of states sites. They collectively have more than $500 million in "available capital." As more and more state sites attract angels, the company will be able to hold speed pitching events and larger regional events in more locations.