Where does someone with limited resources find investors willing to provide the capital necessary to mass market an innovative product? When traditional financing is not available or desirable, entrepreneurs often seek out “Angel Investors.” Wikipedia, the free encyclopedia, defines an angel investor as an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.

 A small but increasing number of angel investors organize themselves into angel groups or angel networks to share research and pool their investment capital.

 Angel capital fills the gap in start-up financing between friends and family who provide seed funding and venture capital funds that usually invest in established businesses. Of the US companies that received angel funding in 2007, the average capital raised was about $450,000. However, there is no set amount and the range can go from $25,000 to as high as $2,000,000. Angel investments bear extremely high risk and are usually subject to dilution from future investment rounds. Because a large percentage of these investments are lost when early stage companies fail, the investors seek a return of at least 10 times their original investment within five years, through a defined exit strategy. As such, the investor will have an ownership interest in the company and may insist on a say in its operations.

 Angel investors are often retired entrepreneurs or executives who may be interested in investing for reasons that go beyond pure monetary returns. These include mentoring another generation of entrepreneurs, and making use of their experience and networks on less than a full time basis. Thus, in addition to funds, angel investors can often provide valuable management advice and important contacts. The past few years have seen the emergence of networks of angel groups, through which companies that apply for funding to one group are then brought before other groups to raise additional capital. The Gulf Coast Venture Forum (”the GCVF”) is a Florida 501(c) 6 non-profit corporation, formed in 2001. The primary purpose of the GCVF is to promote the success of Southwest Florida’s new and emerging businesses by bringing together the best entrepreneurs and Angel Investors. For more information, refer to their web site http://gcvf.angelgroups.net or call 239-262-6300.