FAQ for Prospective Investors
Angel investors are wealthy 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. To maximize the value added, most angels specialize in industries or technologies they understand, and invest only in companies within close geographic proximity.
The Nebraska Angels is an angel investor network organized as a Nonprofit Mutual Benefit Corporation under the Nebraska Nonprofit Corporation Law. It is member funded and member managed. It has a current membership of about 35 accredited investors and expects to have 50 investor members soon.
To avoid individual solicitations, the membership list of the organization is confidential. The organization’s president – elected by the Board of Directors – is John Brasch.
No. The Nebraska Angels is an independent organization that is not affiliated with any outside group. It has, however, been given encouragement by UNL and by others in the University of Nebraska system.
Angel investment typically commits $200,000 to $2,000,000 in a start up company or in an existing company that need financing to move to the next stage. Venture Capital rarely invests in start ups… and typically wants to invest much higher dollar levels. VC’s most often look for established companies that need a minimum of $5,000,000 or even minimums of $30,000,000 or more. Most angel investment comes from private investors who can play an active role in advising the companies. Venture money is of a more institutional nature.
Fundamentally the angel network will look to the quality of the deal. Many different types of deals may provide a basis for investment. That being said, the members of the angel group will likely be highly interested in technology based businesses that offer a good opportunity for a 20x or better return on investment within five years. By contrast the network is less likely to look closely at so called “life style” businesses such as restaurants, local retailers and service providers.
Parties interested in making a proposal to the Nebraska Angels should visit its website www.nebraskaangels.org. At the website, further instructions are available on what is needed and how to present a proposal to the organization.
Each member makes an individual personal evaluation and decision to invest or not to invest based on the presentation at screening meetings, based on findings of the review committee, based on discussion at meetings, and based on the investors’ other evaluation resources. If a member decides to invest, the member deals directly with the firm or the firm’s representative which will have been defined as part of the deal preparation.
As a volunteer led organization there is no regular office or staff. While a phone
(402-434-2121) will be answered by a shared receptionist, the best way of making contact with the organization is by email or through its website: www.nebraskaangels.org.