FAQs on angels
What is an Angel Investor? Angel investors are high net worth individuals who invest in high risk, early stage ventures by reserving a portion of their total investment portfolios to provide emerging companies with seed and startup capital through direct, private investments. Their goal is to achieve higher returns than the typical public markets provide. Most angels are active investors - who contribute their time and experience, as well as offer introductions to valuable contacts essential to the company’s success - because they enjoy the thrill of helping entrepreneurs grow their businesses.
What is an Angel Group? Individual angels come together to form a group to facilitate the review of possible investments and to provide entrepreneurs with a single source to reach many individuals. Angel groups often have web sites that provide directions for business plan submission. After screening business plans for top-quality deals that match the group’s criteria, these groups organize regular monthly breakfast or dinner meetings for members to hear pitches from companies selected to present. If the group (or members of the group) decides to proceed, interested members commonly collaborate on due diligence and deal negotiation. Based on the group’s structure, investments are either made directly by individual members, or by the group as a whole. Most groups apply standard terms to their investments, with some flexibility to negotiate.
What about investment regulation? The SEC allows companies to raise money from accredited investors through the private placement of securities without requiring registration of the securities. For this reason, the Boise Angel Alliance is limited to Accredited Investors.
What is an accredited investor? Generally speaking, accredited investors have a net worth exceeding $1 million. There is a questionnaire to determine accredited status on the “For Angels” page.
Updated December 31, 2009
What is an Angel Investor? Angel investors are high net worth individuals who invest in high risk, early stage ventures by reserving a portion of their total investment portfolios to provide emerging companies with seed and startup capital through direct, private investments. Their goal is to achieve higher returns than the typical public markets provide. Most angels are active investors - who contribute their time and experience, as well as offer introductions to valuable contacts essential to the company’s success - because they enjoy the thrill of helping entrepreneurs grow their businesses.
What is an Angel Group? Individual angels come together to form a group to facilitate the review of possible investments and to provide entrepreneurs with a single source to reach many individuals. Angel groups often have web sites that provide directions for business plan submission. After screening business plans for top-quality deals that match the group’s criteria, these groups organize regular monthly breakfast or dinner meetings for members to hear pitches from companies selected to present. If the group (or members of the group) decides to proceed, interested members commonly collaborate on due diligence and deal negotiation. Based on the group’s structure, investments are either made directly by individual members, or by the group as a whole. Most groups apply standard terms to their investments, with some flexibility to negotiate.
What about investment regulation? The SEC allows companies to raise money from accredited investors through the private placement of securities without requiring registration of the securities. For this reason, the Boise Angel Alliance is limited to Accredited Investors.
What is an accredited investor? Generally speaking, accredited investors have a net worth exceeding $1 million. There is a questionnaire to determine accredited status on the “For Angels” page.
Updated December 31, 2009
