Rising Role for Angel Investors

A study finds that outside the U.S., these seed-funding contributors are outspending VCs.

Across the globe, angel investors are becoming an increasingly big part of source of start-up capital, according to a new study from a Paris-based think tank.

In America angels invested $17.7 billion in 2009—$1 billion shy of venture capital investment for that year, according to the Organization of Economic Cooperation and Development report, which was covered in the Wall Street Journal. And in Europe, angels outspent VCs by nearly $250 million.

The study, one of the first to study angel investing globally, used interviews from 100 businesses and investors across 32 countries, the Journal reports.

Angels liked to invest in nearby companies, and preferred to settle in communities with a large number of start-ups, the report found. However, angels weather a poor economy better than VCs, and tend to invest in a broader range of businesses. —Abram Brown