investments in the Life Sciences and Healthcare sector has dropped significantly in the past three years. Because the size of investments varies among sectors, the distribution of investments by amount is somewhat different. The ICT sector accounts for only 35% of the amount invested. Angel groups predominantly invest in small businesses with growth potential, mostly those with 1–5 or 6–10 employees at the time of the investment, accounting for 42% and 18% respectively of invest- ments in 2019. This concentration of investments in small compa- nies is consistent over time. However, in contrast to previous years almost one-quarter of the investments made in 2019 were in large businesses with more than 50 employees. Over half (52%) of all new investments were in businesses with 1-5 employees (and 74% with 10 or fewer employees), with just a handful of investments in busi- nesses with more than 25 employees. Follow-on investments were concentrated in larger businesses, with 43% of such investments in businesses with more than 50 employees. Angel investment activity continues to be distributed unevenly across Canada. Central Canada (Ontario and Quebec) accounted for 86% of investments compared with 13% in Western Canada and 1% in At- lantic Canada. In terms of amount invested, Central Canada accounts for 94% of the total. There are also regional differences in the propor- tion of new and follow-on investments. In Central Canada, 62% of in- vestment dollars were new, compared with 64% in Western Canada, and 96% in Atlantic Canada. When calculated on a per capita basis, an uneven distribution of investment persists across regions. Angel investors made 14% of their investments in companies located in the same city as the angel group and a further 52% were in the same province. There is a steady decline in within-province invest- ments year-on-year and a large increase in inter-provincial invest- ments which accounted for 30% of total investments in 2019 com- pared to 13% in 2018. International investments continue to be fairly insignificant (4%).
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ANNUAL REPORT ON ANGEL INVESTING IN CANADA
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