Center for Venture Research
Director, Jeffrey Sohl
THE ANGEL INVESTOR MARKET IN Q1Q2 2009:
A HALT IN THE MARKET CONTRACTION
The angel investor market in Q1,2 2009 experienced a considerable decline in investment dollars from last year but exhibited a slight increase in the number of investments. Total investments in Q1,2 2009 were $9.1 billion, a decrease of 27% over Q1,2 2008, according to the Center for Venture Research at the University of New Hampshire. However, a total of 24,500 entrepreneurial ventures received angel funding in Q1,2 2009, a 6% increase from Q1,2 2008, and the number of active investors in Q1,2 2009 was 140,200 individuals, virtually unchanged from Q1,2 2008. The significant decline in total dollars, coupled with the small increase in investments resulted in a smaller deal size for Q1,2 2009 (a decline in deal size of 31% from Q1,2 2008). These data indicate that while angels have not significantly decreased their investment activity, they are committing less dollars resulting from lower valuations and a cautious approach to investing. While the market exhibited a decline from Q1,2 2008, when compared to the market correction that occurred in the second half of 2008 these data indicate that the angel market appears to have reached its nadir in Q1,2 2009.