C ONC LU S I ON I nves tment Tr ends i n 2020 : Summa r y
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ada, reflecting the concentration of angel organizations in this region.
years. Again showing that contrary to the expectations in the middle of last year, angels have not refocused their investments away from new deals in favour of follow-on invest- ments. Investment activity in 2020 was dominated by the Information and Communication Technologies (ICT) and Life Sciences sectors. The dominance of ICT and Life Scienc- es has been a constant feature over time. The majority of investments are in businesses with less than ten employees, emphasizing the role of angels in financing new and young businesses. Investments continue to be concentrated in Central Can-
during the COVID-19 pandemic. Contrary to expectations on the ef- fect of COVID-19, valuations were higher in 2020 than in 2019. By curating the financial capacity of individual angels to invest together in specific deals, angel organizations have the ability to make follow-on investments. The role of angel in- vestors goes beyond the initial in- vestment into a startup to financing the early scale-up of their investee businesses. In 2020 just over one- third of the investments made by angel organizations – both the num- ber and the amount invested – were in follow-on investments. This pro- portion is similar to that of recent
Not surprisingly, angel organizations were less optimistic about the in- vestment environment in Canada in 2020 than in previous years, with the median score dropping from seven to six on a scale of one (very poor) to ten (excellent). Neverthe- less, despite COVID-19, one-third of angel organizations continued to be fairly positive about the investment environment, rating the investment environment at eight or nine. How- ever, highlighting the divergence of views, one-quarter of organizations rated the investment environment at three or four.
202 1 ANNUAL REPORT ON ANGEL I NVEST I NG I N CANADA The Chang i ng Landscape
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