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Nah Kalo Donlot Gratisnya http://rs42.rapidshare.com/files/4345471/Gerald_A_Benjamin_-_Angel_Capital.pdf Cheers --- In obrolan-bandar@yahoogroups.com, Hanif Mantiq <[EMAIL PROTECTED]> wrote: > > *kalo market bearish, mungkin artikel dibawah ini bisa > menambah keyakinan untuk masuk ke market* > > How Angel Investors Get Their Wings > Backing entrepreneurs with good ideas can be a > moneymaker for these daring > investors who go where venture capitalists fear to > tread > > by Chris Farrell > BusinessWeek Magazine > > Not only can John Reid claim to have been visited by > angels, he is one. The > 61-year-old entrepreneur founded his Parkers Prairie > (Minn.) medical-device > company, AbbeyMoor Medical, in 1997 with seed money > from so-called angel > investors. Such people invest in promising startups > too young and raw to > attract the attention and money of professional > venture capitalists. Reid > has also helped fund several early-stage ventures, on > his own and with > fellow angels. > > The credit crunch and economic downturn have some > angels feeling skittish. > But others see opportunity: Studies show that the best > time to start a > business is when the economy is down. That's because > entrepreneurs with good > ideas will find cheaper land, labor, supplier > contracts, and other > ingredients that go into starting a business. Angels > that back such ventures > can earn impressive long-term returnsone study cites > a rate of return of > about 27%, on average, or 2.6 times the investment in > 3.5 years. The risks, > of course, are steep. Still, 258,200 angels pumped $26 > billion into 57,120 > ventures last year, according to the University of New > Hampshire's Center > for Venture Research. > > Any angel will tell you there's a significant learning > curve. But a big > transformation in angel investing is making it easier > to move up that curve: > the rise of more formal angel investing groups. It > wasn't all that long ago > that angels largely hooked up with entrepreneurs > through ad-hoc social > networks, friendships created over the years, perhaps > at the country club or > local philanthropic events. Since the latter part of > the 1990s there has > been a proliferation of more professionally organized > groupsusually with a > Web sitethat screen investments and pool money on a > local and regional > level. Estimates of the number of angel groups in the > U.S. and Canada go as > high as 275. The groups even have their own > trade-and-education association > in Washington, the Angel Capital Assn. > > While many angels are current or former entrepreneurs, > and that background > can prove invaluable, they also need to develop > investing skills. The > successful angel adheres to the same disciplines that > make for a good > investor, from Berkshire Hathaway's ("BRK-A") Warren > Buffett to Yale > University's David Swensen. Understand the risks. > Follow an intellectual > framework. Have a well-thought- out methodology for > buying and selling. Do > due diligence. Diversify. "Angel investing isn't easy, > and it's very high > risk," says Tony Stanco, executive director of both > the National Council of > Entrepreneurial Tech Transfer and of Angel Investors > of Greater Washington. > "But it's high reward." > > Experienced angels recommend that investors create a > diverse portfolio as a > buttress against inevitable failures. After all, these > are companies with > little cash flow and no operating history. Angel > groups funded, on average, > about seven companies in 2007. Only a small percentage > of an angel's capital > should be at riskno more than 10% of investable > wealth, counsels Susan > Preston, currently general partner of the California > Clean Energy Fund's > Angel Fund, a public investment fund that takes equity > stakes in alternative > energy ventures. Longtime angel Richard Holdren, a > Houston-based serial > entrepreneur who has founded or invested in over 26 > health-care startups, > adds that it's critical to keep emotions in check. > "You make money in angel > investing by killing off your losses early, as quickly > as possible," he > says. "The entrepreneur really believes that success > is just around the > corner, and you'll quickly go broke investing for > 'just-around- the-corner. '" > > Angels rightly tend to focus their efforts in the > industry they know. > Stanco, for example, was formerly an attorney at the > Securities & Exchange > Commission working with the software and computer > group. His investments are > concentrated in software. Reid is well-schooled in the > medical technology > business. > > But to get a wider range of perspectives and deals, > and to pool resources, > many angelsincluding Reid, who lives in a largely > agricultural community > with a population of 1,032join angel groups. > > THE "REAL DEAL" > Reid belongs to a group of 26 angels affiliated with a > larger umbrella > network, RAIN Source Capital, based in St. Paul, Minn. > RAIN organizes small > groups of angels in mainly Midwestern states into a > network of some 400 > members. That makes it easier to develop a deal flow, > pool money, and share > expertise. Angels living in Grand Rapids, Mankato, St. > Cloud, and similar > Minnesota towns have invested some $7 million in > Reid's company. "We get > prospects in front of the network to find the members > who will say: 'I used > to be in that business' and to tell us whether it's a > real deal," Reid says. > There could be a deal coming in Mankato, he says, that > "we never would have > seen without the RAIN network." > > The level of professionalism at angel groups is all > over the map. Some mimic > professional venture funds, a number have forged close > ties to universities, > and others are more like social clubs engaged in > for-profit philanthropy. A > common mantra among angels and angel groups is the > importance of due > diligence. That means pursuing questions like: What is > the market > opportunity, barriers to entry, and business model? > What's the company's > competitive edge? Is there an exit strategy? What is > the entrepreneur' s > background? "The biggest fallacy is that 98% of people > think if they have a > wonderful technology the business will take care of > itself," says Holdren. > "But the character of the entrepreneur is more > important than the > technology." > > What sort of return can an angel expect? There's that > rate of return of > about 27%, on average, a result reached by professor > Robert Wiltbank of > Willamette University and Warren Boeker of the > University of Washington in a > study of 539 angels from 86 groups in North America > from 1990 to 2007. The > return figure comes from 1,137 "exits" during this > time period through > mergers and acquisitions, initial public offerings, > bankruptcies, and shut > doors. > > Of course, averages can be a bit misleading. Remember, > on average Lake Erie > never freezes, and the stock market returns, on > average, some 11% a year. > With the return number for angel investing, keep in > mind that 7% of the > venture exits that the professors studied had returns > of 10 times investment > while 39% had a multiple of less than one times > investment. The Center for > Venture Research estimates that angels enjoyed a rate > of return in 2007 > between 20% and 40%. "Invest what you could lose > without changing your > lifestyle," advises Jeffrey Sohl, director of the > Center. Inevitably, part > of the reward will be psychic. But it's fun to > remember the outcome of a > $100,000 investment that Sun Microsystems co-founder > Andrew Bechtolsheim > made to two Stanford University graduate students. The > check allowed the > students to move out of dorm rooms and start marketing > their revolutionary > idea. The result: Google. > > Farrell is contributing economics editor for > BusinessWeek. You can also hear > him on American Public Media's nationally syndicated > finance program, > Marketplace Money, as well as on public radio's > business program > Marketplace. His Sound Money column appears on > BusinessWeek. com. >
