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Thursday, January 28, 2010

Philadelphia angels look for a few good deals

Those starting businesses are often different from those with a lot of money to invest. The challenge is getting the two sides to meet.

This April, more than 100 investors are expected to gather at the Union League in Philadelphia to hear presentations from 30 entrepreneurs at the 12th Annual Angel Venture Fair. (Angels are the private investors, not the scrappy start-ups. The new companies would nevertheless be godsends should they prove to be fast growers and create lots of jobs.)

Who will those companies be? Well, first, they’ll be those that paid $250 to submit an application just to vie for one of those spots.

Sounds like a case of “it takes money to make money.” But Valerie Gaydos, executive director of the Private Investors Forum, which will host the event, said the application and fee are the first screens to weed out those that aren’t serious.

Gaydos said angel investors - many of whom were once entrepreneurs themselves - are more likely to read and offer feedback on a business plan when they know an entrepreneur has parted with some cash.

Most likely to get selected are businesses that have a product and revenue, or those started by people who have started and sold businesses previously, she said.

From the pile of applications, a panel of judges will invite 50 semi-finalists to make live presentations on March 4. From that group, 30 will be chosen to make 8-minute PowerPoint presentations to the angelic host at the April 6 venture fair.

Another 20 will participate in “speed dating” sessions. Each entrepreneur makes a 2-minute pitch to a table of angel investors, then moves to the next table, and so on.

If it all sounds like a lot of blather, consider that companies at the 2009 Angel Venture Fair raised a total of $4.4 million by year’s end and had commitments for up to $2 million more in follow-on financing.

Gaydos said she expects more investors will be looking to do deals this year. “These are people who have money sitting in bank accounts not getting interest,” she said. “They’re screaming for opportunities for where to park their money.”

The application process is totally electronic at the Angel Venture Fair Web site. But hurry because the deadline to apply is Feb. 2.
Posted by Mike Armstrong @ 2:05 AM  Permalink | File Under: Investing, Markets | | Small Business | 1 comment
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About Mike Armstrong
Mike Armstrong, a business editor and writer for nearly two decades, is the Inquirer's business columnist and PhillyInc blog editor. Contact Mike via e-mail or at 215-854-2980
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