Magazine article Black Enterprise

Angel Networks: Women Tap into Heavenly Investors

Magazine article Black Enterprise

Angel Networks: Women Tap into Heavenly Investors

Article excerpt

Many small businesses are started on no more than a wing and a prayer. Others receive more direct help from heavenly people called angels. Not Gabriel and his friends; these angels are private investors who provide entrepreneurs with seed money and expansion capital.

Angels are usually successful, wealthy businesspeople who invest in a young, growing business instead of putting their money in, say, the stock market.

Increasingly, several business organizations and universities are creating networks of individual and institutional investors interested in hooking up with like-minded business owners. And many of these angelic investors are looking specifically to do business with women and minority entrepreneurs, says David Gerhardt, executive director of the Capital Network in Texas. The organization has a national database of some 300 angels and 1,000 business owners.

Most angel networks operate pretty much the same, generally providing a kind of matchmaking service. Entrepreneurs supply short profiles, including a business plan, executive summary and financial projections. The profiles are then categorized, based on the company's industry, size and capital needs. The angels or investors also submit profiles, describing their investment interest and selection criteria.

If that investor likes what he or she sees, then the two groups meet. At this point, the networking organization steps aside. Negotiations are now made between the two parties and their lawyers to determine how the deal should be structured. …

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