Rising startup valuations keep angel investors ‘uncertain’
Dilip Vishwanat
Gil Bickel, chairman of the St. Louis Arch Angels
More angel investors are putting their money into Internet-related companies and less into mobile and health care startups.
That’s according to The Halo Report, a quarterly survey put out by Angel Resource Institute, Silicon Valley Bank and CB Insights.
The report also found that median sizes for angel-only deals increased to $980,000 per deal and that pre-money valuations rose to $2.7 million in the quarter.
Those valuations could be related to the slow start St. Louis startups have experienced in the angel capital market so far this year.
Gil Bickel[5], chairman of the St. Louis Arch Angels[6], said the Arch Angels have invested $3.5 million in 11 deals during the first half of 2014. That’s slower than he had expected before the year started and puts the angel group behind the pace it needs to invest $10 million in 2014, it’s initial goal.
“There seems to be a bit of uncertainty right now as valuations have stepped up a bit and that’s given some pause to some investors,” he said. “I think to some extent, it could just be deal fatigue. There’s just so many deals we’ve done that it’s daunting to keep track of it all.”
The Arch Angels invested $8.5 million into 25 deals in 2013. In 2012, the group invested $5.6 million across 16 deals.
Saint Louis University’s[7] Billiken Angels Network closed two deals in the first half of the year (Helper Helper and Generico) for just under $400,000 said Jerome Katz[8], director of the network.
Katz said the group closed on another deal at the end of July and has seven deals in the due diligence stage.
Rob Wiltbank[9], vice chairman of research for the Angel Resource Institute, said nationwide, an increase in high-profile liquidity events is driving new investments by angel groups and all types of investors, which in turn “will lead to the formation of new companies and continue to feed the cycle.”
Tech, Venture Capital, Startups, Real Estate
References
- ^ Brian Feldt (feeds.bizjournals.com)
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- ^ Twitter (twitter.com)
- ^ Facebook (www.facebook.com)
- ^ Gil Bickel (feeds.bizjournals.com)
- ^ St. Louis Arch Angels (www.bizjournals.com)
- ^ Saint Louis University’s (www.bizjournals.com)
- ^ Jerome Katz (feeds.bizjournals.com)
- ^ Rob Wiltbank (feeds.bizjournals.com)