Online fundraising site for startups AngelList LLC has published its annual year in review report, and despite a perceived slowdown in the venture capital space late in the year, 2015 turned out to be another big year in angel funding.
If you’re not familiar with AngelList, the site caters to early stage startups by providing a service where they’re are able to seek connections with early-stage “angel” investors, while also providing a board for companies to advertise positions available.
For the year 2015 AngelList raised $163 million for 441 startups funded by 3,379 investors, with a total of 770,000 companies now listed on a the site, including those seeking funding, and those who have already obtained it; this compares to $104 million in 2014 for 243 companies from 2,673 investors.
There are now 170 active investor syndicates listed on the site, that is groups of people who co-invest together, and includes well-known venture capital firms such as Sequoia, Kleiner Perkins, Khosla Ventures and more.
Forty percent of the rounds, or 170 startups, raised money in private deals totaling $89 million, while 40 percent of rounds included institutional money.
Despite being best known for raising money, AngelList is growing rapidly as an employment site, with its job board seeing 16,000 active companies and 250,000 actives candidates during the year, with job matches coming in at a staggering 548,000.
Like any bet, be it on a horse or indeed even parts of the stock market, angel funding has high risks involved. But likewise it also has the potential of much higher rewards for a shrewd investor who picks who he invests in well.
While the headline dollar numbers are great for AngelList, the more interesting part is the increasing number of individual investors, and there are likely two factors driving that growth: diversification, where investors are looking to invest in a broader range of startups; and market maturity, wherein much of the growth at the top of the market has already taken place and investors are looking for opportunities to get in on the ground floor so to speak with the next Atlassian, Facebook, or indeed even Google.
As late stage venture capital starts to slow, particularly as we are now seeing across the board valuation revisions (even with unicorns), Angel investing, particularly given it usually requires less capital to begin with, may well become more appealing in the year ahead.
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