77% of the ‘business angels’ that invested in 2019 have returned to invest in 2020

77% of the 'business angels' that invested in 2019 have returned to invest in 2020

77% of the business angels who made an investment in 2019 have invested again this year and 67% of them have done so in an operation to support a start-up in their portfolio.

2019 was a positive year for investment in start-ups, registering a record of direct operations and through venture capital funds and crowdequity platforms.

Despite the coronavirus pandemic, the pace of investment in the last quarter of 2020 is expected to continue and the volume of activity to be similar to that of 2019.

Between the months of January and September of this year, investors have maintained their commitment and support to start-ups.

The report Business Angels 2020. Investment in start-ups: activity and trends, has been presented by the Spanish Association of Business Angels Networks (AEBAN), IESE Business School and CaixaBank, through DayOne, and the ICEX-Invest in Spain .

The study describes the activity of private investors in Spain from a survey carried out on more than 150 of them and shows that 89% of investors increased their portfolio of investees in 2019, with an average of 2.6 new operations each one.

The group of investors is expanding progressively, as shown by the fact that 24% have made their first investment in the last two years.

On the other hand, 49% of business angels continue to finance start-ups in which they already had a stake (follow-on). In addition, the geographic scope of investor activity is expanded, consolidating the entire country as an investment area; The local and proximity component loses weight, to which 30% of investors with international activity are added.

One of the main beneficiaries has been the biotechnology and pharmacy sector. Its weight has grown to 16% of the investments made in 2020, with which one in five investors already has an investee in this sector. If biotechnology, pharmacy and health are combined, this area is consolidated as the preferred one for investors for 2020.

The leisure and media sectors have increased their attractiveness among investors in this period and have good prospects for the near future.

35% of those surveyed consider that the situation has affected their assets and will have fewer funds to invest, while 27% consider that they will not be affected. The rest (38%) have a neutral opinion, perhaps because their equity exposure is very limited or because their sources of income have remained unchanged.

Although investment capacity does not appear to be significantly reduced, the coronavirus crisis will alter the focus of activity, because 42% of investors believe they will make fewer investments in start-ups, while 28% do not expect to reduce them and 30% maintain an indefinite position.