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Alliance of Angels is writing checks again

By Tricia Duryee
Times Eastside business reporter

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It is unclear whether the increase reflects a broader trend, but the results compiled recently by the alliance suggest the rebound appears to be continuing.

The Alliance of Angels is a group of 80 investors who meet monthly to listen to three business plans, which are sometimes not more than an idea. The members then can decide whether they want to invest independently.

The network operates under the umbrella of the Technology Alliance, a statewide consortium of business and community leaders, which is holding its annual luncheon today to discuss the state of the technology industry. Nathan Myhrvold, former chief technology officer at Microsoft, will speak at The Westin, where more than 1,000 are expected to attend.

According to the level of the alliance's investment activity in 2003, angels are writing checks again.

Last year, seven companies received $3.1 million. The previous year — the group's worst in six years — six companies received $1 million. Both are down from the alliance's best year, in 1999, when $4.3 million was invested in 15 companies.

The upward trend appears to be continuing. Since January, funding is on track to match, if not exceed the all-time high, said Dan Rosen, the organization's chairman.

"We are clearly seeing a rebound over the last few months," he said Friday.

The deals are being done more quickly, too. Rosen said after the meeting last month one of the three presenters was approached. By Monday last week, or five days later, it had finalized the deals and handed out checks.

On average, about one in three companies is getting funding. In 2002, the odds were 20 percent. But it could exceed the 30 percent mark this year, Rosen said.

Rosen, who is also a venture capitalist with Frazier Technology in Seattle, said if angel activity is picking up, it will feed the pipeline for venture-capital deals later.
 
For instance, many of the deals that received angel funding in 2002 and 2003 have received venture capital this year.

In recognition of the angel deals, the Technology Alliance created the Startup of the Year Award to be announced today. The nominees — all recipients of alliance funding — are Bothell's Neah Power, the Insitu Group in Bingen, Klickitat County, Kent's Sunstream, Bellevue's VoteHere and Vigilos in Seattle.

Tricia Duryee: 206-464-3283 or tduryee@seattletimes.com