​A new study on the profitability of angel investing, made by the Finnish Business Angel Network (FiBAN) together with Ruben Moring (Åbo Akademi University), is the first broad study on the national angel activity in Finland. The exit data is relied on self-reporting, which is very challenging to gather. The survey was sent to almost 600 angel members of FiBAN and of which 40 responses were received. The responses consisted mainly business angels who actively invest in startups as their full-time profession. This is the largest study made about the angel exits in the Nordics, and so far, only two similar studies have been made before; United States (Wiltbank, 2007) and the United Kingdom (Mason&Harrison, 2002). Therefore, the new Finnish study is internationally remarkable.

For professional angel investors, the role of exits is vital and maintains interest towards startup investing. The study covered 126 business angel exits measuring the Internal Rate of Return (IRR) that observes the profitability of the whole investment lifecycle. The key results of the study show that the pooled IRR is 25% and overall realization multiple is 3.75. This shows that the IRR of the exits of professional business angels in Finland is excellent and in line with international studies. However, more than a half (54%) of the exits that were reported during the survey were unprofitable. Also these results are in line with the general risk level of the business angels.

The survey included only one IPO and no unicorn exits. Therefore, the results show that also smaller exits can be quite successful. The average holding period in Finland was 5,5 years, which is longer compared to the international level. Finnish business angels have also been very active with their portfolio companies; on average they have used 28 hours in a month for a company.

“This survey is an excellent initiative to raise understanding on the profitability on angel investing, and compare the activity internationally. By these means, the results seem excellent. Even if an entrepreneur is not expected to actively think of the exit possibilities, for many investors this is a matter that needs to be planned.” comments Torsti Tenhunen, Chairman of FiBAN.

Even though the returns have been excellent it’s important to notice the high risk of angel investing. Investors’ experience and activity in the startup scene avails the probability of making positive exits.

​“It’s been interesting to compare the results of the survey to my own exits. I can see that gaining more experience in angel investing, and having wider network covering the startup ecosystem really supports my possibilities towards positive exits. In my experience, many investors that have made exits will do new startup investments.” says Riku Asikainen, Vice Chairman of European Business Angels Network (EBAN).

FiBAN will continue making and developing IRR survey also in the future, aiming to make Finland one of the leading countries comparing startup data to business angel activities.

Suggestions on how to optimize the probability of positive startup exits
A business angel can enhance profitability of an exit for example in the following ways:

  1. Decentralize investments to several companies and co-invest together with other angel investors
  2. Be prepared for a long holding period
  3. Evaluate potential exit channels already when making  the investment
  4. Define yourself a maximum limit for investments
  5. Prepare yourself for working hard in the  investment portfolio company


  • Business Angel: A private person investing his/her time, networks, and personal wealth in unlisted potential growth companies.
  • Exit: A business angel makes most of the profits when selling his/her ownership in the startup company, so called ”exit”.
  • Internal Rate of Return (IRR): IRR is a metric used to measure the profitability of potential investments observing the effect of the whole investment life cycle.

Presentation on the Profitability of Business Angel Investment

See the presentation of The Profitability of Business Angel Investment in SlideShare here.


Claes Mikko Nilsen
NordicBAN, Managing Director & FiBAN, co-founder
claes.mikko(at)nordicban.net p. +358 50 491 3001

Riku Asikainen 
European business angel network (EBAN), Vice-President

Reidar Wasenius
FiBAN, Managing Director
reidar.wasenius(at)fiban.org p. +358 400 432100

Torsti Tenhunen 
FiBAN, Chairman of the Board

Ruben Moring
rubenmoring(at)gmail.com p. +358 50 436 1470