This is a guest post by Forrest Wright, freelance researcher and analyst focusing on economic development. He previously worked with Startup Genome and the Global Entrepreneurship Monitor. 

It’s the third story in a series of three articles on his original US angel investment research. Read part one here and part two here.

Angel investors have long been seen as key early backers of healthcare and software startups.

But a closer look at US angel groups’ investments reveals a broader picture. 

Angel groups can be pivotal allies in broadening a region’s startup base.

Life sciences and healthcare deals lead the pack, according to my analysis, with a surge around 2020 due to COVID-19. But angel groups actually spread their bets across a wide range of industries — demonstrating, in some cases, a higher risk appetite than that of traditional VCs. And each region’s angel community has its own preferences, sometimes aligning with local industry strengths and other times deliberately branching into new areas.

In short, angel groups invest across more industries than many expect — and every startup hub has a unique sector “fingerprint” that ecosystem builders can leverage.

Ecosystem builders should treat angel groups as early signal infrastructure. Their sector mix reveals where local conviction and expertise already exist — and where you’ll need to recruit, educate or syndicate outside capital to fill industry gaps.

This analysis covers 145 US angel groups and more than 1,500 early-stage deals from 2019 to 2023, based on Crunchbase data. It focuses on formal angel groups — excluding individual “super-angels” and angels embedded in venture funds.

See the US regions getting the most angel funding

Life sciences and health lead a diverse field

The industry breakdown of angel-group investments confirms that health-related companies were the top focus. 

Life sciences and healthcare accounted for about 36% of all tracked deals — the largest share by far. This aligns with other findings that roughly one-third of angel deals nationally are in life sciences, overtaking enterprise software as angels’ leading target.

Outside health, however, the angel portfolio is notably diverse. 

Unlike VCs, which tend to specialize, research finds that many angel groups are generalists in aggregate. 

Even as some sector-focused angel networks have emerged (for example, biotech-only funds or cleantech angel consortia), most angel groups still cast a wide net — and the overall data shows angels collectively “covering a lot of bases” in regional ecosystems.

Hubs driving angel-group activity in each sector

If angel-backed companies span many industries, where are those deals happening? 

The data reveals that certain startup hubs anchor a disproportionate share of activity in specific sectors. One key point: the data shows where angel groups are based — not where the companies are. 

Because angel groups syndicate deals both locally and afar, a region’s “sector strength” can be something its angels specialize in and export via national networks. With this in mind, a few regional highlights emerge:

  • Silicon Valley is unsurprisingly a major source across the board, accounting for a large share of angel-group deals in nearly every industry.
  • New York City contributes across many categories, but it’s especially prominent in consumer-oriented deals — fitting for a city with plenty of consumer and media startups.
  • Boston stands out in cleantech. Despite its life sciences pedigree, Boston’s angel groups heavily back cleantech startups like Nth Cycle and LineVision, and it also punches above their weight in construction deals.
  • Los Angeles has a strong showing in fintech. LA’s angel groups have been a key source of deals, backing startups like youth banking app UNest, a reminder that LA’s early-stage identity isn’t only about consumer and content.
  • Chicago’s angel groups show notable strength in mobility technology, investing in transportation and hardware startups — ClearFlame Engines, for instance — and signaling that its early-stage activity extends beyond its better-known sectors.
  • Philadelphia’s angel community has a foothold in mobility, too, backing Vertiq (an advanced motor startup) and showing that even a smaller ecosystem can punch above its weight in new tech sectors.
What angel investor behavior reveals about the strength of startup ecosystems

What sectors do local angel groups emphasize?

Now let’s examine each region’s own portfolio. 

Across these regions, life sciences is consistently one of the largest local shares, echoing the national trend. But many hubs maintain balanced portfolios spanning four or five sectors, with no single industry accounting for more than about 25% to 30% of their angel deals. That’s a stark contrast to venture capital firms, which often specialize. 

Angel groups tend to be more generalist by nature. They’re also willing to back companies outside the hot sector of the moment — and by doing so, they often seed the next generation of industries in their locales.

Ecosystem builders: Use angel groups as allies

Angel groups can be pivotal allies in broadening a region’s startup base. 

Unlike big venture funds that chase the same trendy sectors, angels are willing to fund offbeat or emerging industries. That means they can fill gaps by backing startups outside the usual local specializations, like a fintech in Los Angeles or a mobility tech startup in Philadelphia, mentioned above. 

In many ways, angel investors act as grassroots supporters of a more diverse startup economy, unafraid to bet on unproven ideas.

Ecosystem builders should be asking themselves: What industries are your angel groups quietly supporting? Are those bets reinforcing your region’s strengths, or pushing into new territory? 

By recognizing these patterns, local leaders can better partner with angel groups — whether to double down on existing strengths or cultivate brand-new fields.