Published Date Written by Timothy GillisThe Maine Angels, a group of local investors, made the top ten in the nation for investment activity, according to a recent press release.4-23-TG-Sandra-Stone---Copy
The Maine Angels are accredited private equity investors who help entrepreneurs by investing in and mentoring early stage companies, according to their website, maineangels.org. "Our goal is to make sound investments in promising New England entrepreneurs with an emphasis on Maine businesses," the site says.
The Angel Resource Institute (ARI), Silicon Valley Bank (SVB) and CB Insights recently released the 2012 Halo Report, a national survey of angel group investment activity. The survey highlighted four firms in the northeast, with Maine Angels listed at No. 10.
"The report shows angel investing for the year was stable with prior years. Pre money valuations for early-stage companies remained steady at $2.5M and round sizes were relatively consistent. The sectors and geographies getting funding are shifting, however, most notably with mobile and telecom companies gaining share of angel investment deals and dollars, while healthcare companies are losing share of angel investments," the press release read. "Companies in the Northwest and the Southwest U.S. are gaining ground on the number of deals and total investments they receive over companies in California and New England."
"Angel investors continue to play an important role in funding startups," said Rob Wiltbank, vice chairman of research at the Angel Resource Institute. "The steady valuation, growth in investment size, and wide geographic activity among angel investors is more evidence that angels are a reliable and a critical part of growing the next generation of great new companies in this country."
Wiltbank presented the 2012 Halo Report during the 2013 Angel Capital Association Summit, which just took place in San Francisco. The Summit, with the theme, "Navigating Change for Angel Success," was the largest worldwide gathering of angel investors and hosted 600 attendees from 27 countries, 38 states and five Canadian provinces.
Sandra Stone, chair of Maine Angels, said the Maine Seed Capital Tax credit had been a major incentive for companies and investors to close deals last year, but since it capped out in January, "We have seen a real slowdown in our investments now this year."
Maine investments for 2012 were $1,525,000 in eight companies — Zylo Media, Cerahelix, Pika Energy, Newfield Design, Gelato Fiasco, Academic Merit, Maine Wealth Partners, and Abierto Networks, she said.
The Maine Angels is a membership organization that was started in 2003 by Charles Sidman, of Bar Harbor, who now manages a fund for investments.
"Most of the people involved have a direct interest in trying to promote Maine, and Northeast companies," Stone said. "Expertise in telecommunications, medical and pharmaceuticals, finance specialists. We try to tap into each member's strengths."
They hold monthly meetings to have people pitch their new companies, only looking further at those for which there is a minimum member interest in funding at least $50,000. (average funding of $250,000, we look at companies seeking capital of between $100K up to $10M if we syndicate).
"We look at marketability and scalability," Stone said. "There is a lot of legal stuff that has to go on, to protect all the parties. You're better off going to a bank if you need less than that."
There are 22 other New England angel groups, and the Maine outfit shares deals with them.
"Each person brings a new set of eyes and expertise, as well as money to invest, which is really the lifeblood of the company," Stone said. "The average deal is about $250,000, but we don't always take all of that."
The Small Enterprise Growth Fund and Maine Technology Institute help out. "MTI, in addition to grants and loans, are now doing some equity investing," she said. "The more people you have to share the risk the better."