Charlotte, NC – Charlotte Angel Fund, an early stage investment group, today announced the results of a survey that it conducted of Charlotte area angel and venture capital investors. The survey’s purpose was to gain a better understanding of the investment history and outlook of Charlotte’s early stage investment community.
The survey respondents were 61 Charlotte area residents who identified themselves as active angel or venture capital investors. Those 61 respondents reported that their personal investments in the categories of angel or venture capital within the past five years totaled $36.175 million. It should be noted that this represents investment of personal funds rather than any funds which the respondents may manage on behalf of others, and excludes investment into any business where the investor is involved in management.
“The total of over $36 million of angel and venture capital investment made by Charlotte area residents demonstrates that there is a significant level of early stage capital available in our city,” stated Greg Brown, Charlotte Angel Fund’s Administrator. “That equates to $7 million of investment per year, or 14 startups that can be funded at $500,000 annually by those who responded to the survey. It should also be noted that the 61 survey responses represent only a fraction of Charlotte’s active angel and venture capital investors.”
The survey gathered data with regard to the geographic regions where those 61 investors made their investments over the past five years, and where they believe that their investments will be made over the next five years.
“The data clearly indicate that Charlotte investors disproportionately invest close to where they live, with a full one-third of their capital going to early stage companies in the Charlotte metro area,” said Brown. “It is interesting to note that while the Raleigh-Durham area is seen as North Carolina’s hotbed for startups, Charlotte investors have deployed more than three times as much early stage capital in Charlotte-based companies as they have in the remainder of the state. Looking at the prospective data, the investors intend to increase even further their commitment to investing in Charlotte, the state of North Carolina, and the southeast U.S.”
With regard to investment by industry sector, software & apps as well as healthcare were the most popular.
“As expected, software and healthcare were the sectors which received the most early stage investment dollars,” commented Brown. “Of note is that Charlotte investors expect to increase their allocation to software over the next five years, with a corresponding decrease in healthcare startup funding.”
Charlotte investors have also demonstrated a willingness to provide substantial capital to individual companies. Over half of the survey respondents have invested $100,000 or more in a single company, with 15 of them having provided $250,000 or more in investment to an individual company.
“This survey data should be seen as extremely positive news for Charlotte as a whole, and in particular for our city’s entrepreneurial ecosystem,” stated Brown. “Charlotte residents have demonstrated a willingness to provide capital to startups in this city and throughout the state, and intend to increase their allocation to those areas.”
Brown continued, “It is heartening to see the increased level of attention being paid to Charlotte’s entrepreneurial companies, as it is from that community that the drivers of Charlotte’s economic future will emerge. Hopefully this survey will enable data-driven discussions between policy makers, entrepreneurs, and investors rather than having to rely upon anecdotes.”
Brown concluded, “This survey was conducted as a part of Charlotte Angel Fund’s efforts to create a more cohesive early stage investment community in Charlotte. By doing so we aim to improve investment outcomes for angel and venture capital investors in the area, increase the amount of capital that is available to local startups, and make it easier for Charlotte’s entrepreneurs to make themselves visible to local investors.