Angel Investor Database

Every year, thousands of entrepreneurs search for capital to start or grow their businesses.  Many look toward traditional financial institutions such as banks or venture capital firms, but by far the vast majority of financing comes from friends, family and a group of private investors who have come to be known as “angels”.

Most people likely do not realize that angels provide far more funds for entrepreneurs than traditional venture capital.  In 1998, angel investments exceeded $20 billion.  Venture capital firms, during the same period, invested an all-time high amount of only $14.2 billion (up from $11.48 billion in 1997), which was distributed among 2,856 companies.  The average venture capital investment is over $5 million, and venture capital firms will seldom provide funding less than $1 million.  Many young companies, however, do not require this much capital.

Angel investors fill in the much needed finance gap for companies seeking between $250,000 to $1 million.  Many times, companies seeking funding in this range are too early stage or too small for venture capital firms to consider, or they simply may not have the upside potential that venture capital firms are seeking.  The risk involved in financing such ventures can limit the sources of funding available to the entrepreneur.  Angels invest in these small, risky firms in hopes of making large returns on their investments.

Conservative estimates suggest that there are over 250,000 angels in the United States who annually invest in over 30,000 companies.  The average angel investment is $80,000, but angels generally invest anywhere from $10,000 to $200,000 in a single round of financing.

While there are many angels in the U.S., they are often not easy to find.  Rarely do they hang a sign over their door or advertise in the yellow pages.  Nevertheless, there are likely many such individuals in any given metropolitan area.  For this reason, many organizations have sprung up over the years that serve as networks to bring angels together.  Networking offers many advantages over solo investing including shared research and due diligence responsibilities, exposure to a greater range of investment opportunities, opportunities for investment partnerships, and learning from the experiences of other angels just to name a few.

There are many types of angel organizations in existence.  They range from informal groups or clubs to highly structured organizations with regular meetings.  Many third party businesses offer services to angels including confidential databases that match angels to investment opportunities using criteria submitted by the angel.  Several other types of organizations are geared toward entrepreneurs seeking angel capital.  These include matching services, posting forums, and forums and conferences that are generally sponsored by not-for-profit and university-affiliated organizations.

When we began the research for this directory, we originally intended to find as many angel groups as we could, examine their organizational structures and use our findings to make recommendations to emerging angel networks.  The more we searched, however, the more we realized that while there are many groups out there, they are not easy to find.  Moreover, there is no good resource that has any kind of up-to-date list of such organizations.  Recognizing the value of such a list, we set out to compile one.  We expanded our research to include any organization (excluding formal venture capital firms) that brings together investors and entrepreneurs.  We hope to accomplish the following goals:

·        Provide references for organizations that wish to establish some type of venture network.

·        Provide a networking resource for existing networks and organizations that may lead to increased quality deal flow.

·        Provide a resource to entrepreneurs seeking funding for their ventures and to potential angel investors who may be interested in funding such ventures.

This directory is the result of several months of research including media research, Internet research, telephone interviews and analysis of a questionnaire that was mailed to over 220 organizations.  Many organizations that may be useful for entrepreneurs, such as local, small business development centers and chambers of commerce have not been included herein, but may be good resources. 

Organization of the Directory

This directory’s main goal was to provide a listing that was searchable by state.  This was done primarily because research has shown that most angel investors prefer to invest close to home so they can be close to their investment.  Often investors choose to play an active role in their investment by serving as an advisor.  To further refine the search, it is also possible to search by state and city.  Alphabetical listings within each state are provided along with a “verified” category.  If the “verified” category indicates “yes” then these organizations have either responded to our questionnaire or corresponded with us via phone or mail.  Organizations without verified information include organizations that we have heard of, but have not been able to contact.

We have attempted to contact all organizations listed in this directory to give them the opportunity to add to or correct any information that we may have.  We were not able to reach some.  Therefore, there are several blank entries throughout the directory that represent pieces of information that we were not able to gather for this publishing, but plan to research for the next publication of this directory.  We attempted to list the information provided to us as exactly as it was given.

The following includes an example page layout from the body of the directory.  At the top of the page, the name of the organization is listed, followed by a section containing contact information including a contact name, street address, phone number, fax number, email address and web site.  Many of the entries are self-explanatory, but for those that may not be, we have defined their meanings as we have used them below.
 

Function of Organization:

• Formal Matching Service - organization that finds investors for entrepreneurs or vice versa as their main purpose.
   

• Posting Service - organization that allows entrepreneurs to post their venture on some kind of list that is made available to investors.
   

• Venture Funding - organization that provides cash for entrepreneurs.
   

• Angel Investment Group - group that meets regularly to discuss and/or review venture investment opportunities, which members may subsequently invest in individually.
   

• Pooled Investment Group - similar to investment group, but members contribute to a pool of funds that is used for investing in opportunities selected by the group as a whole.
   

• Venture Development - organization that exists primarily to offer non-financial support to help entrepreneurs develop their venture in any or all stages.
   

• Conference/Forum/Network - organization that sponsors a periodic gathering of members and/or nonmembers for the purpose of education, presentation, or networking involving entrepreneurial venture opportunities.  This is the predominant type of organization listed throughout the directory.
   

Geographic Interest:

• Local - less than statewide
   

• Statewide - includes the entire state
   

• Regional - more than statewide, but less than national
   

• National - including the entire country of origin, but no international interests
   

• International - including the country of origin as well as any number of other countries
   

Organizational Structure:

While these categories are generally straightforward, it should be noted that organizations were given the opportunity to check as many boxes as they felt were applicable.  Many checked only one box, which may or may not be accurate for any given organization.  For example, many respondents to our questionnaire checked only the “private” box, omitting “for-profit” or “not-for-profit.”  We feel that this was an error due to our data collection techniques, and we plan to correct this in future research and publications.  An “other” box was added for any organizational structure that may have been overlooked.  All responses marked “other” are detailed in the additional comment section at the bottom of the page.
 

Investment Stage Preferences:

• Seed - stage at which business is still at the concept or idea level and funds are needed for market research and feasibility studies.
   

• Start-up - funding mainly used for pre-commercialization efforts, company has little if any sales
   

• Expansion - any stage after start-up when business is operational and at break-even or better, but needs extra financing for expansion and/or development.

Does Organization Screen Investment Opportunities?

It is often important for both entrepreneurs and investors to know to what extent, if any, an organization screens investment opportunities.  Some organizations may screen an opportunity simply by looking over a business plan, some may engage in extensive due diligence, and some may not screen opportunities at all.  We have not provided any information concerning the depth of screening.  There are simply too many possible degrees of screening to list in this type of directory.  Additionally, many people may have different ideas of what constitutes screening or due diligence.  Nonetheless, we felt that it was important to distinguish those groups that perform some type of screening from those that do not perform any.

Additional Comments About Organization:

This section includes remarks from any categories marked “Other” on the rest of the page.  It also includes a brief synopsis of organizations that provided us with such material to include in this directory.  When organizations did not provide us with explicit information for this section, but did provide us with printed material about their organization, we reprinted portions of the material provided and summarized whenever possible.

Additional Submissions and Corrections

It is our hope that as this directory is distributed, readers will notify us of any organizations that they may be involved in or aware of that may benefit from being listed in future additions of this directory.  This directory becomes a more valuable resource for all readers with each addition.

One of the most important desired benefits of this directory is that it provides accurate, current and complete information throughout.  We want to produce a quality resource, and encourage all readers to notify us of any changes, errors, or inconsistencies found within the directory.

All additions and corrections should be forwarded to:

Angel Capital Directory
Missouri Innovation Center, Inc.
410 S. 6th St.
Columbia, MO  65211-2290
Phone: 573-884-0492
Fax: 573-884-3600
mgr@marketmaker.org

We welcome all comments, and we hope that you find this to be a useful and valuable resource.

© 2003 Missouri Innovation Center