Angels: Diversity and Inclusion amongst Early-Stage Investors

By Guest Author | angels | February 4, 2021

Refreshingly, awareness towards diversity and inclusion is ever present, this has certainly been seen in wider society as well as in the corporate world, although arguably at different lengths.

By SAM KEISNER, Partner at Go10x Ventures

Research carried out by McKinsey& Co firmed the hypothesis of the presence of a positive correlation between a company financial performance and its workforce diversity; this is known as the presence of a multi-gender and multi-cultural working environment. This applies particularly to the start-up ecosystem and it is clear that although there has been progress, there is quite a way to go.

According to the Founder Institute, in the US, only 2% of senior positions at VC firms are held by African Americans, creating a growing industry of investors who don’t align with present-day consumer and business interests. As well as this, statistical data from a survey conducted by UKBAA tells us that the demographic profile of the angel investors is predominantly male, white and an average of 55 years old with an underrepresentation of women and minorities – in this article we will explore this demographic further.


We have mentioned in previous posts that investing pre-seed and seed can be extremely risky and while opportunity does present itself where angels find great teams and products they really believe in, these opportunities present themselves to relatively wealthy individuals who are able to buy a ticket for the ride. This is the underlying reason behind the high average age of investors. According to the UKBAA, only 4% of angel investors are aged between 18-34 and 10% between 35 and 44.

The largest angel group sits in the 45 to 64 years bracket with 64%, bringing the average age of business angels from our sample to 55. Having experienced angel support you is extremely beneficial to a business’ growth, as they can bring with them invaluable experience, networks and advice.

It is also true however that we are seeing the increasing popularity of more accessibility into the investment space. The rise of crowdfunding has meant that the opportunity to invest in startups has opened up to many more. As well as this the increasing popularity of rolling funds, as championed by AngelList, as a method of fundraising for VCs also makes becoming an LP more accessible. For now, we expect the age demographic of investors to remain high, but we will certainly be interested to see if there will be a shift towards the democratisation of investment opportunities with popular platforms such as crowdfunding and rolling funds.

Geographic Demographics within the UK

The London Start-up Ecosystem is ranked as the number one in Europe and third in the world after San Francisco and Silicon Valley. The city has the perfect combination of a high-quality and diverse talent pool, an entrepreneurial environment and infrastructure to support it, plenty of network opportunities, a well-established angel investor community along with the tax incentives to support it and a strong presence of venture capital firms. For this reason, London remains the most prominent home location for angel investors with 34% of the total 508 surveyed.

The second most dominant geographical for angels in the UK is the South East of the UK, with 22% of the total. This data is significant, but statistics show that even if investors are spread in different locations, 55% of the angel investors who invested in 2018/19 made at least one investment in the capital. Also, if we look at the total value of investments received, London received just over 50% of angel investments in the survey while Scotland received only 11%, followed by 10% invested in overseas start-ups.


According to the survey in question, 86% of the angel investor respondents were male. In the UK, the number of female angel investors makes around 13% of the total, which is relatively low when compared to a 29.5% representation rate seen by our cousins across the pond in the US. The reasons for this disparity can be found in many places, one reason is the still ever-present income and wealth inequality we see in this country. In addition to this, according to our data, statistically female angel investors are more risk-averse compared to their male counterparts, so the average ticket size amongst female angel investors is lower.

The sign of an upward trend in the number of female investors is positive, we have seen many angel groups and angel syndicates set up to encourage more women to become business angels. Addidi Angels and Angel Academe are just two examples of brilliantly successful groups of angel investors that have set out to introduce more women to angel investing and that are looking to fund more women-founded businesses. It is clear that by empowering women founders and having initiatives in supporting their projects, we would be able to make progress in reaching gender equality in the entrepreneurial world.


The inclusion of people from different cultural backgrounds and experiences is one way that innovation and success can be made possible. Black and Asian investors remain underrepresented in the UK angel market. Among the 508 people surveyed, we found 79.2% angel investors that are White British, 15.7% are White from other ethnicities, 6.3% are Asian and only 0.6% are Black. However, 3.3% of the total UK population and 44% of London’s population (where we have seen 34% of angel’s investing in our survey) are Black.

We have seen encouraging signs from a number of financial institutions and they have really reaped the benefits by combining motives of inclusion, representation and entrepreneurship. These firms are doing more than just virtue signalling through twitter, they are actually supporting the black startup community by getting behind entrepreneurs trying to push this ecosystem. Impact X is a London-based VC that was founded to support underrepresented entrepreneurs across Europe and we have seen similar efforts from VCs such as HBCUvc BLCK VC. Now what’s left is for larger funds to follow that lead and make a commitment to hiring and funding from minority groups.

Overall there is an expansion trend within the angel investment community towards a more inclusive and diverse participant base, both from the founders’ side and the investors’ side. The good news is that there are ever more fantastic opportunities for investors to support minority founders and a greater breadth of investment choices that an angel investor can choose from. Data shows that investments in diverse founders’ start-ups can have a significantly higher ROI compared to investing in a less diverse one. That being said, it is encouraging to see this and there are more and more initiatives aimed at making the start-up community less niche and more open and inclusive to support talents from all different backgrounds no matter their gender, belief or skin colour.