Wisconsin firms raised more than $152 million in early stage funding in 2011, reflecting a record year for angel investments but a decline in venture capital financing from 2010 totals, according to a report by the Wisconsin Angel Network.
The annual “Wisconsin Portfolio” report tracks early stage investment deals in Wisconsin, including deals involving organized angel networks and funds, early stage venture capital funds and individual angel investors whose deals are reported.
Total early stage investments charted by WAN and the Wisconsin Technology Council for 2010 were $180.9 million, with $130.7 million in venture capital investments and $50.2 million in angel group and individual investments.
The 2011 total showed venture capital investments at $91.7 million – down about 30 percent but still above Wisconsin’s five-year average. Angel investments, including angel groups and individual “super-angels,” increased to $61.1 million, up about 20 percent. The 2011 angel investment total is a record since WAN and the Tech Council began collecting data in the early 2000s.
Since 2003, when angel network-only investments were pegged at $1.74 million, there has been a 35-fold increase in angel group and individual investments reported through WAN and the Tech Council.
“The meteoric growth of angel investment in Wisconsin proves we are doing a lot of things right,” said Tim Keane, managing director of the Golden Angels and chairman of the Wisconsin Angel Network’s advisory committee. “Sustaining this growth will require the concerted effort of investors, entrepreneurs and state policymakers. We are especially concerned about our follow-on capacity for these companies – an issue we need to address.”
The number of venture deals in Wisconsin stayed fairly steady in 2011 with 22 transactions, compared to 24 in 2010, while the number of reported angel deals increased from 54 to 63. Because some companies attracted both angel and venture financing, there were 76 Wisconsin companies that received some type of early stage financing.
“While angel investing remains a bright spot for Wisconsin, we need more venture capital capacity to help promising companies grow,” said Zach Brandon, director of the Wisconsin Angel Network. “Now is not the time to play it safe or to let other states pass us by. Now is the time for smart public policy, and the creation of new angel groups and venture capital funds.”
More detail about Wisconsin’s risk capital market is available in the 2012 Wisconsin Portfolio. Published by WAN and the Tech Council, the report focuses on early and later stage capital trends and processes. It is compiled with multiple data sources, including national reports, and internal tracking by WAN and its partners, including the Wisconsin Economic Development Corp. Not all deals are disclosed, however, so actual totals may be understated.
Features include a summary of Wisconsin’s tech economy strengths, information on Wisconsin’s early stage investment scene, reported 2011 deals, historic investment data, an investor resource guide, a locator map for Wisconsin’s angel networks and funds, and “Why Wisconsin” features on entrepreneurs who have attracted private equity investments.
The Portfolio is available for download at www.wisconsinangelnetwork.com. To purchase printed copies of the 24-page magazine, including bulk amounts, contact Gina Leahy at (608) 442-7557 or firstname.lastname@example.org.
Publication sponsors are: WEDC, University Research Park, the Wisconsin Health and Educational Facilities Authority, the State of Wisconsin Investment Board, UW-Milwaukee and UWM Research Foundation, the accounting firm of BDO, AT&T, Grant Thornton, American Transmission Co. and the state Department of Financial Institutions.
The Tech Council is the independent, non-profit science and technology advisor to the governor and the Legislature, and a catalyst for tech-based economic development in Wisconsin.
The Wisconsin Angel Network is part of the Tech Council’s overall effort and serves as the umbrella organization for Wisconsin’s more than two-dozen angel groups and funds.