On Wednesday, BusinessWeek released their list of the top 25 angel investors in the tech industry, naming Hunch co-founder Chris Dixon ahead of veteran angels Ron Conway and Reid Hoffman. Conway and Hoffman are two of the most influential angels in tech, and have invested in some of the largest Internet companies known today, including Google, Facebook, Twitter and Digg. Dixon, a younger, less experienced investor than Conway and Hoffman, snagged the top spot due to both his diverse investment portfolio and the superior financial performance of his investments.
The list was curated in partnership between BusinessWeek and the startup tracker YouNoodle, which took a three pronged approach to ranking the tech angels. First they analyzed the growth of the angels’ investments based on the amount invested, the number of employees, and the number of “companies operating at valuations greater than $100 million, and the sale of any companies for more than $50 million.”
Leadership was the next key factor which BusinessWeek and YouNoodle took into account. “The importance of each angel was measured by looking at the network of co-investments between angels, as well as at the ability to act as a bridge to other angel groups,” writes BusinessWeek’s Ira Sager. “From the perspective of an entrepreneur, the ability to attract other investors is critical.”
Lastly, they compared each angel’s portfolio for diversity, which helped push Chris Dixon above his fellow angels. Dixon, an early investor in Skype, and his Hunch co-founder Caterina Fake (ranked 20th overall) hold the top two spots in terms of portfolio diversity. Despite being ranked 11th in terms of influence, Dixon was crowned the king of the angels thanks in no small part to the range of industries he has invested in; however the overall success of his investments seems to have played the largest role.
The financial performance category seems to have been given the most weight by BusinessWeek and YouNoodle. The top seven angels also fall within the top eight best financial performers; Paul Graham (No. 11 overall) is the outlier here, ranking seventh in terms of financial performance. The category with the least weight seems to be portfolio diversity, as Conway and Hoffman achieved their high ranks despite placing 12th and 24th respectively in diversity. Their cause was undoubtedly helped by their 1st and 3rd place finishes in terms of influence.
In fourth place overall is Esther Dyson, an investor in Delicious and Meetup, and behind her is Peter Thiel, who helped Yelp and Zynga get off the ground. Rounding out the top 10 is Marc Andreessen, Jeff Bezos, Chris Sacca, Mike Maples and Andy Bechtolsheim. Y Combinator’s Paul Graham found the #11 spot, Digg’s Kevin Rose came in at #15, Naval Ravikant is #22, and Google’s own Eric Schmidt is #24.
What are your thoughts on BusinessWeek’s list? Do you think the measuring sticks they used to rank the angels are fair? Or would you use different metrics to determine the best of the best? Let us know what you think in the comments.
