FAQ
What is an Angel Investor?
Angel investors are wealthy individuals who directly invest a portion of their private net worth into high-risk, early-stage ventures, in order to provide these emerging companies with seed and startup capital. Their goal is to achieve higher returns than the typical public markets provide, while nurturing tomorrow’s business champions. Most angels are active investors – in other words, they also contribute their time and experience, and offer introductions to valuable contacts who are essential to the company’s success. This is because they enjoy the thrill of helping entrepreneurs grow their businesses. To maximize the value they can add, most angels focus on industries or technologies they understand, and invest only in companies within close geographic proximity.
What is an Angel Group?
Angel investor groups vary in structure, from formal to informal. Formal groups follow strict participation requirements that guide members’ minimum investment activity and event attendance. Some groups even pool their members’ capital for the manager to invest on the group’s behalf, while others allow individual members to invest in specific deals of interest.
An Angel group’s investment can be anywhere from $50,000 to $500,000 per deal, depending on how many group members are interested in each deal. While no two angel groups operate exactly alike, most angel groups maintain a local or regional geographic focus in order to maximize members’ ability to actively engage in the growth of their investments. 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 where members can 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. Depending 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 do you look for in companies?
Members of Maple Leaf Angels invest in companies that offer an exceptional opportunity to enjoy high returns on their investment. This criterion usually implies that the companies have the potential to achieve high growth, a strong market position, and sustainable advantages. We generally invest in companies that we believe have the potential to grow to more than $50 million in annual revenue within five years. This growth should be planned for either a developing market or an existing market with national scope.