Maine Angels grow membership, invest $3.3M in 2020

Despite the pandemic and the myriad challenges it presented, Maine Angels is reporting a positive year in terms of deals, membership, and overall health of the organization.

The group, which consists of high-net-worth individuals who pool their resources to invest in and mentor early-stage companies, invested $3.3 million in 19 companies in 2020, and grew its membership by more than 40%.

Of the capital deployed, six of the investments were in companies new to Maine Angels’ portfolio, while 13 represented follow-on investments in companies members had previoulsy invested in, according to Ralph Nodine, who became Maine Angels’ chairperson 18 months ago.

“It was a good year particularly in regard to the number of members who made investments and bodes well for the future as this seems very sustainable,” Nodine said. “We are also becoming more active and sophisticated as investors, which should benefit the companies in our portfolio.”

The amount invested in 2020 is up from most prior years, by roughly 10% to 20%, Nodine said. Though it’s down a bit from 2019, but Nodine considers that year an outlier as it had one deal that got a lot of interest from a few large investors and represented 25% of the group’s total investment that year.

Of the new investments, four of the companies are Maine-based. The new investments were in the following companies:

Circinus Medical Technology, a Texas-based medical device company that has a Maine founder
Flux Marine, a Rhode Island-based company developing electric outboard motors — broad support
HighByte, a Portland-based industrial software startup
Junora, a Biddeford-based company developing new technologies in film-coating processes used in manufacturing
Tilson Technology, a Portland-based company that manages telecommunications, construction technology, software and infrastructure projects
Pumpspotting, a Kittery-based startup building software to support breastfeeding moms at home and work

Another positive development in 2020 was that the Maine Angels raised $2.4 million to create the Dirigo Angel Fund I, a pooled investment fund that will supplement the individual investments made by members.

Pandemic accelerates an evolution

The pandemic posed a serious challenge for several of Maine Angels’ portfolio companies, which served as a “wake up call” for investors, Nodine said. The situation prompted several Maine Angels members to roll up their sleeves and help in more active roles than previously, an effort that led to more collaboration within the organization and ultimately has improved it, he said.

“We had to adapt and as a result, we’ve learned a lot and found a new way of working and dramatically increased our membership and our participation,” Nodine said.

He said the organization has been evolving for several years, tracing back to the early to mid 2010s when Sandra Stone served as chairperson.

“We’re a much stronger angel organization from the standpoint of good processes, good procedures and members who know what they’re doing and ability to do our business effectively, which is good for our members and good for the ecosystem,” Nodine said.

Virtual meetings drive membership increase

During 2020, 26 new members joined the group, bringing the total membership to 86.

Significantly, of the 86 current members, 33% are women, which is a large increase compared to 2016 when only 14% of members were women. Some of that increase is due to the group’s focus on increasing involvement from female investors, including launching a lunch-and-learn event in 2020 for women interested in learning more about angel investing.

One overall driving factor in the increase in membership was a pandemic-induced shift to a virtual meeting format, Nodine said. Whereas before members had to either live in the greater Portland area or be willing to commute to meetings, which is where startup founders would pitch the group and investors could share their due diligence and make investment decisions, virtual meetings allowed investors from further away (even a few who live out-of-state but have Maine ties) to participate. Nodine said they will try to maintain a virtual option going forward, but even so it’s up for debate whether that membership level can be sustained once the pandemic is over and more in-person meetings are held.

“It’s going to be a challenge when we go back to in-person meetings to have the technology that will allow the people participating remotely to feel as much a part of group as when we were all on Zoom,” Nodine said.