The following article is a summary of information reported in “Angel Investment Groups, Networks, and Funds: A Guidebook to Developing the Right Angel Organization for Your Community” by Susan Preston in association with Kauffman Foundation. September 2004.
Angel Investing – Part 3
Implementing your Angel Organization
Once you have decided on the structure of your organization you are ready to implement your angel group. Successful implementation will determine the future of your group. There are steps you can take to make implementation smoother.
It is important to properly identify and communicate with potential members. The recruitment, screening, selection and orientation process help you build a solid membership base. A website and/or written materials should clearly communicate membership expectations, your organization’s structure, investment potential, the group philosophy and ethical standards. Construct a committee with a good understanding of your group who can effectively communicate to manage member recruitment and selection. This committee needs to be willing to thoroughly review applications, interview candidates and host prospective members at a group meeting. Documentation is also an important component of membership implementation. Your group needs a membership application with qualifications, group philosophy, code of conduct and ethics, and reasons for removal clearly stated as well as a renewal and application review process. It is necessary to have a stated removal policy as well and a written process for reflecting on all membership steps.
Other important aspects of membership recruitment include:
Meeting structure can be the most difficult aspect for members to agree on. Meeting parameters to determine include:
Operational costs are influenced by many factors, but the following expense items provide a starting point for creating a group budget.
Investment Evaluation and Process
The investment process can take many forms, but generally will follow these primary steps and one of the listed alternatives:
Angel Investing in Your Community
This past month we’ve looked at the reasons angels are important, how to build the framework of an angel organization and how to implement your angel group. It isn’t easy to build an angel investor network. But, in many areas, especially rural areas, an angel network is the greatest asset to building an entrepreneurial environment. Angel investors provide a critical and essential link to fostering a healthy economy by providing important financial support and business mentoring services to emerging and growing entrepreneurs.