Archangel Investors is the longest-running business angel organisation in the world, and today celebrates a quarter of a century of being at the cutting edge of early-stage investing in Scotland.
It is quite an achievement, and has been a critical driver of Scotland’s increasingly stellar industries of technology and life sciences, in particular. From the syndicate’s efforts, more than 80 young businesses have got the lifeblood of often game-changing funding to help them find their feet, or quicken their step.
We can truly say that we have improved lives worldwideEric Young
A key component of Archangels’ service to entrepeneurial talents is that the Edinburgh-based syndicate often provides mentoring as well as capital, an extra boost to confidence for young businesses at a psychologically as well as financially crucial stage.
Formed in 1992 by entrepreneurs Mike Rutterford and Barry Sealey, the syndicate now comprises more than 85 investor members, with one of its main partners being the Scottish Investment Bank, the investment division of Scottish Entreprise.
The timing of tonight’s celebration at Dovecote Studios in Edinburgh, to be attended by more than 180 investors and entrepreneurs, is felicitous. The audience will hear that 2016 was another milestone for Archangels, when it led funding rounds totalling a record £14.6 million – the largest investment lead by any business angel syndicate in Scotland. That was up on investment of £13.9m in 2015.
However, it is the cumulative figures that show the true scale of the oil greasing the wheels for a generation of Scotland’s young businesses.
Last year saw total funds invested by Archangels investors since the syndicate’s formation pass the £100m mark (£103.5m). An additional £33.4m of funding has come from the SIB, pretty much a wall of money backing fledgeling tech and life sciences businesses, some of the latter spun out of universities.
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Eric Young, chairman of Archangels, said: “The four pillars on which Archangels was founded: to put something back; support young Scottish companies; make an investment return; and have fun; have stood the test of time well. Through our investments in companies such as Touch Bionics, producer of the world’s first bionic hand, and Optos, creator of the world’s first widefield eye scanner, we can truly say that we have improved lives worldwide, and that continues today, exemplified by our latest investment in PhysioMedics, for their online back pain tool.
“We value highly the support which our investors and our key partners, particularly Scottish Investment Bank, have provided during this journey. In the next 25 years, we will continue to build on what we have achieved so far, to support and nurture future generations of entrepreneurs to generate value for the Scottish economy and our investors, and to create high quality jobs and improve lives.”
The keynote speaker at tonight’s event will be Sir Brian Souter, founding chairman of Perth-based buses and rail business Stagecoach and a longstanding Archangels investor.
The headline sponsor of the event is Barclays Bank, with further support from law firm Dickson Minto, MBM Commercial and accountants Chiene + Tait.
Members will hear that Archangels returned £31.5m to investors in 2016, roughly double the £16m returned in the previous year. It is not just a philanthropic exercise. The latest payback came via the sale of Touch Bionics in Livingston to Icelandic prosthetic limb specialist, Össur, and a deferred consideration on the sale of Dundee-based CXR Biosciences the previous year.
They are part of a panoply of Archangels-backed success stories that is testimony to the group’s impact. Archangels’ firms have generated an estimated £1.39bn in turnover since 1992. That equates to £14.34 for every £1 invested. The syndicate’s investment activities have produced £989m of gross value add (GVA) – GDP at a regional level – to the Scottish economy.
One of its first investments was in Dunfermline-based Optos, which floated on the London Stock Exchange in 2006 and was subsequently acquired by Nikon Corporation in 2015. Today, Archangels has a portfolio of 22 companies employing 660 people.
Professor Rob Wiltbank, associate professor of strategic and entrepreneurship for the Atkinson Graduate School of Management at Willamette University, Oregon, and widely regarded as an expert in angel investing, said: “Archangels is the longest consistently running business angel organisation in the world. This is something to be proud of in Scotland.”
Stuart Brown, head of SME for Scotland and Northern Ireland at Barclays, added: “We understand entrepreneurs and how important the angel community is to helping a venture succeed.”