Читать книгу How To Become A Business Angel - Richard Hargreaves - Страница 9

You may be surprised to learn that in the USA angel financing accounts for almost as much money invested as all venture capital funds combined – but into more than 60 times as many companies.

In 2010, angel funding totalled $20 billion into 61,900 companies compared to $23 billion of VC funding into 1,012 companies. The average amount of money raised from angels was approximately $300,000, compared to nearly $23m from VCs, which shows that angels are much more important than VCs at the smaller end of the market.

Technology dominates the type of venture backed but where the investment is made varies widely from year to year. For example, in 2010 investments in healthcare rose to 30% (from 19% in 2007) and investments in software were down to 16% (from 27% in 2007). In the USA, Silicon Valley businesses account for the lion’s share of all angel investments and in the States there are more than 250,000 active angels.

In the UK a 2009 research report ‘Siding with the Angels’, published by NESTA (an independent body with a mission to make the UK more innovative), concluded that business angels have grown in importance in the UK since 2000. The percentage of all early-stage deals with angel involvement increased from 16% in 2000 to 41% in 2007. Indeed, the report concluded angels are often the only source of capital at the smaller end of the market. The report estimated that there were between 4,000 and 6,000 angel investors in the UK with an average investment size of £42,000 per investment.

In contrast, the UK Business Angels Association (UKBAA) said on its website in 2012:

“an estimated £850m per annum is invested by angels annually in the UK. This is more than 2.5x the amount of venture capital invested in early stage small businesses annually. Whilst it is also estimated that there about 18,000 angel investors around the country, there is a need for more individuals to become business angels to provide finance to meet the needs of the growth potential entrepreneur”.

Obviously there is disagreement in the figures here and I do not have an explanation for the discrepancy in these two estimates of the market size. Suffice it to say, however, that the UK angel market is large and growing.

There is no doubt that tax advantaged schemes, developed over many years by successive governments, have been a major factor in the growth of UK angel activity. In a 2011 Budget Commentary, NESTA referred to the impact of the Enterprise Investment Scheme (EIS, see Chapter 6) and stated:

 “Since its inception, EIS had provided 48% more finance to early stage businesses than the VC industry; and

 “EIS provided more funds than VC for amounts less than £2m. In 2006-7, for amounts up to £2m, EIS provided 63% more funding than the VC industry.”

The commentary also cited a survey in which 80% of business angels said they had used the EIS at least once. Notably, 53% of them would have made fewer investments without EIS tax incentives.