FT.com - Angel investors give more to Asian groups

South-east Asian start-ups are getting as much as 50 per cent more money in early stage funding than their British counterparts, according to the head of one of Europe’s largest angel networks.

Angels Den, which has more than 3,000 individual investors on its books, has calculated that investors at its events in Singapore put on average £300,000 into each venture they back, compared with £200,000 in the UK.

The study also found that south east Asian investors put on average about 12 per cent of their personal wealth into early stage ventures, whereas in the UK the figure was only 8 per cent.

Bill Morrow, co-founder of Angels Den, said investors in south-east Asia tended to have more money and more appetite for risk than those in the UK.

"They have a gambling mentality, so they are more willing to be more cavalier with their money," he said.

"Almost all the money we are seeing invested is Chinese, coming out of either Beijing or Shanghai."

Angels Den, which is currently planning to open operations in Malaysia and Hong Kong, claims that it has seen a surge of interest from entrepreneurs as banks are increasingly cautious about investing in fledgling businesses.

Unlike bank finance, angel investing seldom relies on analysis of a company’s financial forecasts, according to Morrow.

Angels Den also interviewed 50 of its most experienced angel investors and found that about three quarters of them relied on a "gut feeling" to decide whether or not to put money into an early stage venture.

Almost one-fifth of those asked said they did not rely at all on their adviser’s calculations, and only 5 per cent said that they relied on an adviser’s calculations.