The latest survey by the National Angel Capital Association (NACO) reports that angel activity among its members resulted in 139 investments — 102 new, 30 follow-on and seven unknown — worth $40.5 million in 2012. That's a 13.4% increase over 2011 when 71 investments worth $35.7 million were made.

Activity was up 96% year-over-year but the average deal size was down considerably, indicating that investments are starting to converge around smaller amounts.

The top angels groups by dollars invested are Golden Triangle Angel Network, Angel One Network, Northern Ontario Angels, Capital Angel Network and VANTEC. The top three sectors by amount invested are information and communications technology ($17.9 million), life sciences ($7.5 million), and clean technology ($3.2 million).

The third annual Report on Angel Investing Activity in Canada survey enhances NACO's capacity to identify root trends in the angel investment community as baseline data improve, making it possible to compare it to other data sets.

"Better comparison between regions is now possible," says NACO executive director Yuri Navarro. "We're revamping our data collection tools and adding more groups to produce more granular data."

In the three years NACO has commissioned the survey, there have been 361 investments valued at $158.23 million. NACO only captures the activity of so-called visible angels, with the vast majority of activity going unreported. It is produced by Global Advantage Consulting Group with support from Industry Canada and the Natural Sciences and Engineering Research Council.

The report shows that Ontario- and Quebec-based NACO members account for 82% of the 2012 total. The finding reflects the strength of the angel communities in central Canada but also the geographic location of most NACO members. Navarro says regional representation will likely be more uniform next year as Anges Québec ramps up its investment activity and several new western Canadian-based angel groups join.

The 2012 report includes a major correction in the 2011 version, where misreporting by one unidentified angel organization resulted in a reported 2011 total of $82.4 million. The data have since been corrected.

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