angeled_bill bartee_market update & trends
DESCRIPTION
TRANSCRIPT
![Page 1: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/1.jpg)
Angel Investing
Trends and Highlights
![Page 2: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/2.jpg)
A Few Facts
• $20B invested in the U.S. annually• 60,000 companies – 80% seed• 258,000 active angel investors• Average investment size - $10K - $100K• Not neat and tidy• Hard work but fun
![Page 3: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/3.jpg)
Why Invest Early – High Return Potential
• $1000 in FB in 2005 = $624,500 today (62,450%)
• $1000 in Airbnb in 2009 = $589,667 today (58,967%)
• $1000 in Dropbox in 2008 = $391,500 today (39,150%)
• Peter Thiel invested $500K in FB for 10.2% in 2004. He sold 16.8M shares at IPO for $638M and has another $396M left.
![Page 4: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/4.jpg)
But Remember
• Many die
• Some survive (1 – 5x) • A few thrive (20x+)
![Page 5: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/5.jpg)
Startup Investor Ecosystem
Angels & Incubators($0-10M)
“Micro-VC” Funds ($10-100M)
“Big” VC Funds ($100-500M)
“Mega” VC Funds (>$500M)
StarfishSouthern Cross
General Catalyst
Pollenizer
Startmate
PushStart
Tank Stream
Carnegie
Blackbird
Sequoia
Accel
GBS
Netus
Innovation Bay Incubation
Seed
Series A
Series B
Series C+
Bootstrap, KickStarter, Crowdfunding
![Page 6: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/6.jpg)
Highlights Q1 2013 – Halo Report
• Median Angel Round Size Up To $700K
• Pre-Money Valuations Average $2.5M
• 81% of deals occur in angel groups home state
• Angel Groups Syndicate 3 Out of Every 4 Deals
![Page 7: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/7.jpg)
Median And Mean Round Size
![Page 8: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/8.jpg)
Co-Investing Median Round Size
![Page 9: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/9.jpg)
Q2’13 Sectors
• Internet – 37.2%
• Healthcare – 19.9%
• Mobile – 13.6%
• Software – 4.2%
![Page 10: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/10.jpg)
Sectors
![Page 11: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/11.jpg)
Round Size By Sector
![Page 12: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/12.jpg)
U.S. Valuations
• First Quartile - $1.2M
• Median - $2.5M
• Third Quartile - $3.0M
• Top Quartile - $5.5
![Page 13: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/13.jpg)
Valuations – Halo Report
![Page 14: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/14.jpg)
Co-Invest Percentages
![Page 15: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/15.jpg)
Strategies to Enhance Performance • Pick a Goal – Is this for fun, profit or philanthropy?
• Invest Where You Have Industry Expertise – Analysis indicated that expertise has a material impact on angel investors’ returns. Returns were nearly double for investments in ventures where the investor had related industry expertise and contacts.
• Increase Due Diligence Time – Investors experienced better returns in the deals where they exercised more due diligence. Sixty-five percent of the exits with below-average time spent on due diligence reported a return that was less than their original investment. Losses occurred in only 45 percent of the deals where investors did above-average due diligence.
• Syndicate or Co-Invest With Experts (pattern recognition)
• Build a Portfolio (10 or more) – Look at a lot of deals before you invest
• Participation or Adding Value – After an angel makes an investment, his or her participation in the venture – through mentoring, coaching, and financial monitoring – is significantly related to that venture’s returns, according to the study.
• Be Careful With Follow-On Investing – Deals where the angel investor made follow-on investments generated significantly lower returns. In ventures where follow-on investments were made, nearly 70 percent of the exits occurred at a loss.
• http://www.kauffman.org/research-and-policy/returns-of-angels-investors-in groups.aspx#sthash.TObynS6L.dpuf
![Page 16: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/16.jpg)
Important Considerations
• Team, expertise, and market are most important
• Chemistry must be good
• Deep understanding of the problem (authentic connection) + passion is key
• Deal structure and valuations are important but secondary
![Page 17: AngelEd_Bill Bartee_Market Update & Trends](https://reader036.vdocuments.net/reader036/viewer/2022070303/54b757ce4a795905078b45aa/html5/thumbnails/17.jpg)
Places To Learn More• http://www.paulgraham.com/angelinvesting.html (Paul Graham)• https://angel.co (Angel List)• http://www.angelresourceinstitute.org (Angel Association US)• http://www.fabricegrinda.com/entrepreneurship/9-business-selection-crit
eria/• http://www.svb.com/halo-report/ (Halo Report)• http://aaai.net.au (Australian Association of Angel Investors)• http://www.tommckaskill.com/ebooks/angels.html (Tom McKaskill’s book
An Introduction to Angel Investing)• Innovation Bay, Sydney Angels, Melbourne Angels, SA Angels, etc