HBAN says its business angels cash out with up to 10 times return on investments.

The all-island Halo Business Angel Network (HBAN) has reported that the last 12 months have seen its angel investors celebrate exits of up to 10 times their initial investment.

Among these were considerable profits from four Irish start-ups in the last 12 months.

“Business angels don’t just provide capital; they have the industry experience, knowledge and connections that allow businesses to scale and demonstrate their market value”

Companies like Iconic Translation Machines, Payslip, Decawave and Finovation have all raised at least seven-figure sums while in the last five years notable exits have included Phorest, iCabbi and Embo Medical.

Flying with wings

Man in navy jacket leans against rail in Dublin's docklands.

John Phelan, national director, HBAN.

Most recently, Dublin City University spin-out Iconic Translation Machines was acquired by London-listed RWS Holdings in June 2020. The company, which specialises in language technology software, was established in 2013 with the backing of angels from HBAN’s Bloom Equity and the Boole Investment Syndicate. The acquisition was for an initial consideration of US$10.0m with additional deferred consideration of up to US$10.0m in RWS shares.

In March 2020, Mayo-based fintech start-up Payslip raised an additional €2.9 million in a Series A funding round led by Frontline Ventures. The company provides automation and integration technology to multi-national employers to manage global payroll. Some HBAN investors from the Bloom Equity syndicate exited with a four-fold return on their investment, while others have continued to follow their investment.

In January 2020, the computer chipmaker, Decawave, was acquired by NASDAQ-listed semiconductor company, Qorvo, for €362 million. The Dublin-based company was founded in 2007 and investors from Bloom Equity and HBAN’s Investor Forum were amongst the hundreds of international angel investors with a stake in the company. Following the acquisition, HBAN’s angels received returns of between four and eight times their investment.

Irish financial services company, Finovation, was bought by UK-based pensions and insurance firm Legal & General in August 2019. The company, which trades as My Future Now, helps people to keep track of their pension pots and consolidate them, using personal data and employment details. It was established in 2014 with the support of business angels from Bloom Equity and was acquired by Legal and General for an undisclosed sum.

The exits add to the number of significant returns for HBAN angels in recent years. In 2018, Renault acquired a 75pc stake in the Dublin-based taxi technology company, iCabbi, allowing early stage investors from HBAN’s Bloom Equity to exit with a 10-fold return on their investments.

Also in 2018, Susquehanna Growth Equity invested €20 million in the salon management software company, Phorest.

Some HBAN investors from Bloom Equity and Boole Investments maintained their interest in the company, while others exited with returns of up to 10X.

And in 2016, Embo Medical was acquired by CR Bard’s subsidiary, Clearstream, for almost €43.5M after raising a total of €3M in funding rounds that included HBAN’s Irrus and MedTech syndicates.

Money but also expertise and experience

“It has been a very exciting 12 months for HBAN’s angels and these exits reflect that, along with the value that angel investors bring to start-ups,” said John Phelan, all-island director of the Halo Business Angel Network.

“Business angels don’t just provide capital; they have the industry experience, knowledge and connections that allow businesses to scale and demonstrate their market value.

“On top of that, securing angel investment puts start-ups in a better position to attract additional investment. Last year, we passed our €100m angel investment milestone, which allowed start-ups to leverage an additional €170m in funding from additional sources. That is good news not just for start-ups, but also for angel investors, as it increases the likelihood of a successful exit.

“Some of Ireland’s most promising and exciting businesses started out with business angel funding. As we set out along the road to post-COVID-19 recovery, these businesses will play a vital role in our economic future,” Phelan said.

Written by John Kennedy (john.kennedy3@boi.com)

Published: 17 July, 2020

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