July 2010 -- Welcome to the twenty-second edition of the Angel Capital
Education Foundation newsletter, reporting matters of interest to angel
group leaders and others involved in angel investing with a special
focus on best practices. Click on the titles below to read the full
Evolving Models of Angel Groups
an investment class, angel groups continue to proliferate, evolve, and
mature. Growth, financial stability, and investment success are
priorities. Groups train for deal leads, raise sidecar funds, seek
earlier exits, contribute to broader support for entrepreneurship, and
manage through up and down economies. Some group members pursue angel
investing as a career.
Group Profile: ICE Angels
Angels was founded in 2003 and is one of the first New Zealand angel
groups. The group has more than ninety members and affiliates who have
invested more than NZ$14 million (US$9.8 million) in forty-two
investment rounds that totaled more than NZ$26 million (US$18 million).
There are seventeen companies in ICE Angels' portfolio. In 2009 the
Kiwis had a record year.
2010 Hans Severiens Award and Inaugural Luis
Villalobos Award Announced
The Angel Capital Association
and Angel Capital Education Foundation named John May-managing partner
of the New Vantage Group, ACA co-founder and chair-emeritus, and active
participant in five angel groups-as the recipient of the 2010 Hans
Severiens Award. ACA also announced Modumetal of Seattle, WA, as
inaugural winner of the Luis Villalobos Award.
Education Contributes to the Sustainability of
Continuing education and skills building
contribute to stronger connections and relationships between members of
angel groups while helping angel group members become better angel
investors. Groups become better at conducting due diligence,
understanding the concepts and approaches to term sheets, and leading
the valuation process.
Privacy and Data Protection for Angel Groups
same privacy protection and data security issues that affect
individuals and companies create important considerations for angel
groups. Collecting and storing only necessary private information,
understanding providers' privacy policies, and granting access to
information only on an as-needed basis are all good practices.
"Angel Amendment" Protects Efficient Capital
Access for Entrepreneurs
In July, Congress approved the
final Restoring American Financial Stability Act of 2010 (now called the
Dodd-Frank Wall Street Reform and Consumer Protection Act) based on an
important amendment in the Senate. The amendment, which was included in
the House-Senate conference committee, will ensure that high growth
entrepreneurs continue to have access to a strong pool of angel capital
and that investors are better protected from fraud. The final bill had
not been signed by the President as of the publication of this article.
2010 ACA Summit Held
Capital Association's annual Summit was held May 5 - 7 in San Francisco.
More than 400 attended, the largest gathering of angel investing groups
in the world. Presentation, panel discussion, and roundtable topics
included syndication, working with venture capitalists, accelerated
exits, trends in angel investing and group models.
Harvard-MIT Paper: Angels Improve
"The Consequences of
Entrepreneurial Finance: A Regression Discontinuity Analysis," a working
paper published by Harvard Business School (HBS) quantifies the
positive impact of angel investors on the new ventures they fund.
Overall, the study results suggest that investments by angels improve
about four conferences: Auto Venture Forum, National Angel Capital
Organization Annual Summit, National Association of Seed and Venture
Funds Conference, and Investors' Circle National Venture Fair and