Angels boost fledgling businesses
"When Stevens Point native Leon Ostrowski returned to Central Wisconsin eight years ago to retire, he brought with him 35 years of business development know-how gathered in Europe, Asia and the United States.
In May, Ostrowski joined with the Portage County Business Council, Wood County's Heart of Wisconsin Business Economic Alliance and a group of private investors to form the Central Wisconsin Business Angels. It is one of a dozen similar groups in the state and hundreds across the country whose goal is to help entrepreneurs in the early stages of their businesses receive the financing and guidance they need to bring their dreams to the marketplace.
"It's investing in all those things you need before you can even start a business," Ostrowski said of the $100,000 to $500,000 financing packages that are typically put together by angel networks. "Those amounts can't be obtained from a bank or other financial institutions because the businesses aren't developed yet."
Small groups of people have come together to invest in start-up companies for centuries. But the formalized organization of these groups into their own, separate entities for the purpose of early-stage, or angel, investing, is a new phenomenon that has taken off over the last few years.
Angel investing is different from venture capital investing, which normally involves millions of dollars and could include expanding a company's reach into a market. Angel investors look for the potential and business knowledge they see in a management team, whereas venture capitalists also look for a proven track record of a company.
Early-stage investing is just that; funding without which a company wouldn't be able to get off the ground. Venture capital, for the most part, is geared for companies that are farther down the business life cycle.
"If you don't have early-stage investors, there are not going to be any companies to put venture capital into," said Joe Kremer, director of the Wisconsin Angel Network, which helps support the networks across the state.
The financing often comes in the middle stage of the angel investing relationship.
"Sometimes I'll work with a company for two or three years before we bring it to the investment group for consideration," Ostrowski said, adding that during that time, attorneys, accountants and banks will be referred to the prospective business for guidance."
In May, Ostrowski joined with the Portage County Business Council, Wood County's Heart of Wisconsin Business Economic Alliance and a group of private investors to form the Central Wisconsin Business Angels. It is one of a dozen similar groups in the state and hundreds across the country whose goal is to help entrepreneurs in the early stages of their businesses receive the financing and guidance they need to bring their dreams to the marketplace.
"It's investing in all those things you need before you can even start a business," Ostrowski said of the $100,000 to $500,000 financing packages that are typically put together by angel networks. "Those amounts can't be obtained from a bank or other financial institutions because the businesses aren't developed yet."
Small groups of people have come together to invest in start-up companies for centuries. But the formalized organization of these groups into their own, separate entities for the purpose of early-stage, or angel, investing, is a new phenomenon that has taken off over the last few years.
Angel investing is different from venture capital investing, which normally involves millions of dollars and could include expanding a company's reach into a market. Angel investors look for the potential and business knowledge they see in a management team, whereas venture capitalists also look for a proven track record of a company.
Early-stage investing is just that; funding without which a company wouldn't be able to get off the ground. Venture capital, for the most part, is geared for companies that are farther down the business life cycle.
"If you don't have early-stage investors, there are not going to be any companies to put venture capital into," said Joe Kremer, director of the Wisconsin Angel Network, which helps support the networks across the state.
The financing often comes in the middle stage of the angel investing relationship.
"Sometimes I'll work with a company for two or three years before we bring it to the investment group for consideration," Ostrowski said, adding that during that time, attorneys, accountants and banks will be referred to the prospective business for guidance."
 |
For more information, visit www.EvanCarmichael.com. |
0 Comments:
Post a Comment
<< Home