25 April 2017

German surgical appliance and supplies maker among recipients of angel investment in April

2017 has gotten off to a good start in terms of European angel investment. According to Zephyr, the M&A database published by Bureau van Dijk, in Q1 2017 both volume and value were higher than for the same three months in 2016. In total there were 166 European angel investments worth a combined EUR 403 million announced in Q1, marking an improvement on the EUR 318 million invested across 142 deals in the opening quarter of 2016. The result is also higher on both fronts when compared with Q4 2016 (129 deals worth EUR 317 million). This is encouraging and will give many hope that Q2 can also surpass the same period of 2016, thereby getting the year off to a positive start. Q2 is only just underway, but there have already been a number of fairly large angel investments announced since the beginning of April. In the quarter to date EUR 30 million has been invested across 17 deals. A few larger injections will need to be made over the coming months if results are to come close to those for other recent quarters. In 2016 Q2 surpassed Q1 in terms of volume and value, so if 2017 is to surpass 2016 as a whole it is important that significant levels of dealmaking are recorded in the coming months.

The largest European angel investment to have been announced in April to date is worth EUR 7.50 million and featured a German company as electric scooter manufacturer unu brought in funding from Capnamic Ventures Verwaltungs, Iris Capital Management, NRW.Bank, Founder.org Inc. and Michael Baum. Proceeds of the round have been earmarked for ongoing development of the firm’s product and planned expansion into France and the Netherlands.

As always, a variety of companies based in different countries and industries have been the recipients of angel investment in April, although software businesses remain a popular destination. Interestingly, in addition to the investment in unu, another German company which is active in the mobility field also featured this month. Stuttgart-headquartered eMovements, which develops and manufactures an electrical walker, received EUR 500,000 from an undisclosed business angel. The firm intends to use proceeds of the transaction to product its ello electric walking frame, which it hopes to launch during the summer of 2017. The company, which was founded in May 2016 and has additional locations in Dusseldorf and Berlin, has so far invested around EUR 1 million into the development of ello, having received injections from over 100 private investors in the past.

Manufacturers of surgical appliances and supplies are not traditionally frequently targeted by angel investors; since the beginning of 2006, 30 such transactions have been signed off. The largest was announced in August 2006, when US-headquartered IntraPace, which developed an implantable weight loss device, secured EUR 23.60 million from The Angels Forum and other investors including Vulcan Capital, L Capital Partners and Oxford Bioscience Partners. This was followed by a EUR 23.56 million injection in US medical implants maker Axonics Modulation Technologies by Edmond de Rothschild Investment Partners, NeoMed Management, Legend Capital Company and a group of undisclosed private individuals in March 2014. The largest European angel investment within the sector is the sixth-largest overall and involved Switzerland-based non-fusion spinal instruments and technologies developer SpineLab receiving EUR 7.19 million from BioMedInvest, VI Partners, SHS and BrainsToVentures, among others. Other companies in the sector to have piqued the attention of angels since 2006 have been based in locations such as Israel, France, the UK and Canada

In conclusion, 2017 has started promisingly in terms of angel investment levels targeting Western European companies, but Q2’s performance will give a better indication of how the year is likely to shape up in the long term. Continued investment across the region will help, but it will be the larger transactions that will make the difference and determine how positively the year and quarter are viewed in hindsight.

© Zephyr