Thursday, June 11, 2009

Payback for Angel Investing

At the Members meeting of the TacomaAngel Network on Wednesday June 10, guest speaker, Professor Rob Wiltbank, revealed his landmark study of Angel Investor Investment Returns in the US and Britain and how they compare to those of Venture Capitalists.

Angel Investors are private individuals who give of their time and money to help new growth companies in ways similar to VC’s, but generally do so at an earlier stage, and for smaller amount than do Venture Capitalists.

Some of his findings:
  • Poor returns come back quickly, while big returns can take longer—about 56% of investments returned under 1 times the investment in less than 1 year, about 34% returned from 1 to 5 times the initial investment in about 3 years, 7% returned 5 to 30 times in just under 5 years, and an additional 3% returned over 30 times in about 6 years.

  • This produced an average a portfolio weighted return of about 27% which compared favorably to the British 22% and the VC returns of 17% and 15% respectively, before and after fees respectively. The presentation also included a series of returns improving guidelines derived from the study.
Rob also shared key principles from his new and highly praised book on Catalytic Leadership. He was also available to talk one on one with guests and for book signings after the session.

Rob Wiltbank (right) receiving a TacomaAngel Network Pad-folio from Founding Co-chair Larry Kopp (left) in remembrance of his talk.
Rob Wiltbank is Professor of Strategic Management at Willamette University—at the Atkinson Graduate School of Management, a Batten Fellow, and partner of Buerk Dale Victor, a growth stage venture capital fund based in Seattle, Washington. His ground- breaking research includes the first empirical examination of the outcomes achieved by angel investors, and the role of entrepreneurial expertise in decision making

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