Tech Coast Angels’ Dollars Invested and Number of Deals Declined in 2009
Bruce V. Bigelow3/2/10Comments (2)Follow @bvbigelow
Investments by Southern California’s Tech Coast Angels dropped in 2009, as the network of individual investors helped raise a total of $61.7 million in direct investments by TCA members and affiliated investors. The angel investor group says it participated in seven new deals and 17 follow-on deals last year, according to a statement.
The organization, which includes more than 300 members in five regional chapters, says its members made $4.7 million in direct investments in startup companies last year, and helped to attract an additional $57 million from other sources.
The total invested in 2009 was about 18 percent lower than in 2008, and the number of deals declined by about 22 percent. In 2008, the Tech Coast Angels made a total of $75 million in direct and affiliated investments in 15 new deals and 16 follow-on rounds.
In a statement issued by the TCA, chairman Richard Sudek struck a tone of encouragement about the number of follow-on rounds, which increased from 16 in 2008 to 17 in 2009: “Clearly our members feel deeply committed to our invested companies and believe in their growth,” he said. “We not only continue to raise money for them, we also provide day-to-day operating assistance and mentoring that company executives tell us often make the biggest difference in their success.”
The angels group, which is technically a nonprofit mutual benefit corporation, identified several San Diego startups that its members funded last year:
—MicroPower Technologies has developed technology for ultra-low power wireless video cameras. By coincidence, the Telecom Council of Silicon Valley said yesterday that MicroPower Technologies was among seven new telecom companies to win the service providers’ “spiffy” awards.
—Hookit.com, formerly known as Loop’d Networks, is an online social network for lifestyle sports with features and services created for athletes and brands.
—Benchmark Revenue Management develops financial management software to help hospitals handle billing and collection issues.
Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788
Mike Elconin
3/2/10 9:31 pm
I think 2009 was still a quiet year. Investors are still cautious, although the reason has changed — in late 2008 and early 2009 investors’ assets were in free-fall and there were worries the economy could go into a depression. That’s seems less of a problem now, but what I call “follow-on financing risk” has grown. VC funds remain very tight and M&A and IPO activity has been slow to recover, both of which make early stage investors cautious. On the plus side, start-ups are slowly retooling their plans to take into account the tightness in the VC world, and they are designing plans that require less follow-on capital