Angel Investors — Who Are These Guys?

Skye Leist
July 17, 2011

Simply put, angel investors are those people and groups that invest money in new businesses, usually in their own geographic area. The sums invested might be small, but the impact is immense. Without angel investors, many small businesses would never get off the ground.

So who are these guys?

Well, yes, most of them are “guys”. There are a few groups of women angel investors around, but not a lot. Angel investor groups are scattered around the world, with more groups in prosperous areas and in more populated areas.

Beyond that, it is hard to categorize them. I recently sat in on a round of presentations to an angel investor group. This was in a relatively rural area, so I met a retired executive from a large manufacturing company, an immigrant who owned the largest farm around, a bank manager, the CEO of the largest retail store in the area, a retired chemistry professor, and a few other business people, both retired and active. Common knowledge or experience was virtually lacking in this group. The only thing they truly had in common was the desire to make their area stronger economically.

And that is exactly what many angel groups seek to do: make their geographic area stronger economically.

They know well that the stronger the general business community is, the better it is for their own business. While some potential investors were interested in finding the next Big Deal, for the most part they were looking to bring commerce and credibility to their area.

This is a key consideration in presenting to angel groups, especially in our current economic climate. Answering the question, “What will this business do to help this area?” lingers there, unasked, and for the most part unanswered. So answer it, even if it is not asked. Use your business plan for angel investors to delineate just how many jobs this business will create, and just what the level of expertise for those jobs will be.

Businesses that create jobs for India and China are definitely out of favor. Point out in no uncertain terms how this business will benefit the local community, and hence will also benefit the angel investors.

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