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Most of the angels BRW spoke to had no more than about 20 per cent of their invested wealth in early-stage companies, although in one case it was 70 per cent.
Brisbane-based Jay Hetzel has increased his total wealth in angel investments from zero to 20 per cent since he began in 2008. “I have a relatively standard portfolio of investments, however I have moved more of my investments into the angel space because of two reasons,” he says. “One is the returns from the stockmarket and property are less attractive than they used to be.”
Second, he reckons the demand for innovation is increasing and investments in innovative companies, versus established ones, will have a better long-term return.
Jim Kalokerinos says he has “a lot more money” in listed mining, banking and biotechnology stocks than in early-stage companies. But his angel investments are tracking better.
He says his equity portfolio probably will bounce back, or be dragged up by external forces but points out there are also non-financial reasons for being an angel investor. “Some of the companies I’m involved with have products or services that will make a difference and getting those through is a big whizz,” he says, pointing to one company that’s working on an early diagnostic tool for the illness sepsis.
“Once the company gets through its regulatory and other hurdles and gets this product on the market, I will get a lot of satisfaction, not only monetarily, but because the product is needed.
“I invest in all the asset classes but the one that’s the most exciting is the start-ups.”