Fenwick and West have published another study full of interesting information regarding angel investments in the US. In the study titled Angel and Seed Financing survey in the internet/digital media and software industries they analysed the size of the rounds in 2010 as well as who lead the rounds among other things. There are some interesting findings here that possibly signal of new things in the horizon.

Some of the key findings in the survey are that, perhaps not surprisingly, seed and angel investments are becoming very professional. This is shown in two areas of the results. Firstly, there has been a shift from friends, family and other wealthy individuals to professional angels, seed funds and even venture capital funds willing to invest smaller amounts of capital. Secondly, the terms of these investments have become more professional together with the shift in investors – the agreements have become more sophisticated and longer.

With the shift in investors, there is also a lot more money in the market – angel and seed rounds can now easily exceed $1 million and investors can also take part in the follow up rounds. The median amount raised was $662 500 while the pre-money valuations in the internet/digital media industry was $3.4 million and $2.7 million in the software industry.

The table above shows that first of all internet/digital media received over 2/3 of the investments, but also interestingly in one quarter of the cases venture capital funds lead the rounds. This is an interesting sign of possibly different times to come as VCs have traditionally stayed away from such small investments in general. Understandably seed funds and professional angels led many of the rounds.

This post is part of a series of posts supported by Nexit Ventures.

Nexit Ventures is a mobile venture capital firm focused on wireless technologies and services. Leveraging its extensive network in the global mobile marketplace, Nexit invests primarily in Nordic and US-based earlystage companies with products and services for a global market. For Nordic mobile companies, Nexit provides a bridge to Silicon Valley markets and exit opportunities.