A report by the American Business Journal cited at the NFIB web site finds that the number of angel investors may have dropped by as many as 80% in the past three years. But this study should be looked at carefully.
Although certainly alarming, especially given the fact that the number of entrepreneurs continues to increase, this needs to be put in perspective. This report is based on a database set up to connect entrepreneurs with willing angels–for a fee. Many long-time angels would never put their names in a public or even semi-public database. Many of these angels may be newer to the game, and may not have been really ready financially or emotionally. From my perspective I see that deal flow at the angel level is beginning to move again, and many long time angels are getting back in the game. This study may just be one more artifact of the dot.com boom and bust. Never much real wealth there anyway.