Out of 387 investments by Tech Coast Angels through 2018, 205 (53%) are still active.
Of those no longer active:
- 79 (43%) returned some cash to investors
- 103 (57%) were total write-downs or seem inactive
Of the 79 Exits
- 58 returned at least 100% of the investor’s capital
- 20 returned between 5x and 263x
- 3 have no info on the multiple returned
If one had invested $25k in each of the 387 investments, this would be $9.7 million invested. You would have:
- already realized $22.4 million in cash liquidity events
- taken $2.6 million of tax-deductible write-downs
- …and still have $5.1 million of active investments. If that performs the same as the first exits/write-downs, an additional $25.2 million in cash would be realized – implying a potential 4.9x overall return (not counting tax benefits of write-downs)
How does this 4.9x realized return on all dispositions compare to averages for Angel Investing? Dr. Rob Wiltbank has done the most extensive study of returns for Willamette University and the Angel Resource Institute, and he recently presented his results at the annual Angel Capital Association Summit in May 2016. For a copy his full presentation, click here. The summary shows that the 4.9 x return by Tech Coast Angels compares favoably to the 2.5x measured by ARI in 2016, as well as earlier studies. TCA’s 23% IRR is slightly higher than the 22% measured by ARI, TCA’s hold period of 4.8 years is slightly longer than ARI’s 4.5 years, TCA’s percentage of exits returning less than 1x is slightly better at 67%, and the concentration of exits in the top 10% is slightly higher at 90% :
