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Ann Arbor Spark

June 18, 2019

Angel Investment is on the Rise in Michigan

Angel investment is a key driver of entrepreneurial and economic growth

The Michigan Angel Community recently released its 2018 angel activity report and the numbers are encouraging. Here were some of the key finding for 2018:

This was the second annual report produced by the Michigan Angel Community, a statewide initiative designed to increase angel investment in Michigan and make more capital available for technology startups in the state. The Michigan Angel Community is also supporting more systematic sharing of deal-flow among all of the state’s angel groups to both provide better deal access for angels, and to help entrepreneurs raise more money, faster.

The initiative is facilitated by Ann Arbor SPARK and supported by the Ralph C. Wilson, Jr. Foundation, and other corporate sponsors throughout the state. All of the state’s angel groups and investors are part of the community.

While the results of 2018 report are trending in the right direction, Michigan still has a lot of room to grow. Angel investors are high-net-worth individuals or families with an annual income of at least $200,000 (individual) or $300,000 (family) or an investable asset base of at least $1 million. Recent census data show that Michigan has approximately 98,000 households with a net worth over $3 million. That means there are a lot of potential angel investors in our state.

We need more people to become angels in Michigan. Angel investment is critical to the growth of new industries, to diversify the economy, and to produce high-wage jobs. They are typically the first source of capital that high-growth-potential startups pursue (after tapping out their own resources) to commercialize new products/technologies and go to market. Without the availability of angel capital in a region, startups either fail to grow, go out of business, or leave the region to find capital elsewhere. We have seen this play out in Michigan frequently in the past, but it’s gradually changing.

There are many benefits to becoming an angel and investing some of your capital into this asset class:

  • Potential for high financial returns
  • Portfolio diversification
  • Give back — help entrepreneurs succeed (including opportunities to share your wisdom through mentoring, advising, or serving on a board)
  • See the ‘next cool thing’
  • Make a difference — help grow the local/regional economy and create high-paying jobs

The annual report was presented at Michigan Celebrates Angels in May at the Breslin Center in East Lansing, which brought together angels from around the state. On November 12, we will hold the second annual Michigan Angel Summit at The Henry Ford in Dearborn. More details coming soon.

Please visit our website for more information and feel free to contact us directly if you have questions or would like to meet. We look forward to helping you become an angel investor or form an angel group.

If you’re interested in learning more about angel investing, the Michigan Angel Community can help you. The Michigan Angels Community hosts a variety of events throughout the state year-round, where you can learn the basics of angel investing and connect with other investors. View Upcoming Events