Who will be the next Medtronic? What will be Minnesota's next breakthrough industry? James Walsh will provide the latest information and commentary on the people, companies and trends driving innovation in Minnesota. From visionary entrepreneurs to game changing technologies, this blog offers a window into the future of Minnesota's economy.
Investments from wealthy individuals into early-stage companies has been picking up, according to a report released this month from University of New Hampshire’s Center for Venture Research.
Angel investments last year were $22.5 billion last year, up 12 percent from 2010, the report said. The number of active investors also increased 20 percent to 318,480.
“It appears that an optimism in angel investing is taking hold,” said Jeffrey Sohl, director of the Center for Venture Research.
Analysts had been concerned that investors were withdrawing from funding start-ups in recent years. Minnesota investors said they were reluctant to invest in new companies because their money was tied up in earlier investments that they couldn’t exit because of the weak economy. They were also concerned about the uncertainty surrounding how long it would take to get federal approval to sell medical devices.
But the new report suggests the situation nationally is improving. Last year, 42 percent of angel investments were going toward companies at the start-up stage. The hottest category for investment was software, representing 23 percent of the deals, the report said. Health care represented 19 percent. The biotech and industry/energy categories each represented 13 percent of the investments.