Angel investors are directing their money toward more start-up ventures, according to a study reported in Red Herring.
Angel investors are funding more early-stage startups this year than at any point since the Internet boom....Innovators who meet with angels are twice as likely to get funding this year than two years ago, a study shows. In 2005, angel investors backed 21.8 percent of the companies they investigated, up from 10.3 percent in 2003, according to a study by the Center for Venture Research. (emphasis added)
In a related story Red Herring also has a Q&A interview with fund managers from a group that invests in early stage businesses. It provides some interesting insights into their investing strategies.
We think that early-stage opportunities now are some of the best we've seen since the fund's founding 22 years ago....There are areas like semiconductors, which are continuing to change the world. There is the enterprise. There's the rise of open-source and on-demand software models like AJAX, the transfer of applications to mobile devices, and so on....We're not into trend investing. We tend as a fund to be into the picks and shovels, and looking at applications that are less sexy, but high growth.
More money that is being targeted toward clear and simple business models. Let the good times roll!
