Angel Investors

Angel investors may indeed be all around us, but I'm beginning to wonder if these wealthy investors have enough time to belong to all of the groups that want them as members. That thought occurred to me last week as I watched the inaugural meeting unfold of the Philadelphia chapter of the Keiretsu Forum , an international angel network based in San Francisco. After months of work, due-diligence expert Howard Lubert and financial adviser Vincent Leusner have brought the 21st chapter of the Keiretsu Forum to Philadelphia.

Private investors in a small technology company are the first to participate in a Pennsylvania program that guarantees a portion of such investments against losses. As part of the deal, Aereon Solutions Inc., which had revenue of $300,000 last year, has moved from Princeton to Newtown. The company provides technology to assist service people in the field. A state spokeswoman said the move would bring a dozen jobs, paying $60,000 to $70,000 a year, to Pennsylvania. The guarantee will cover $62,500, or 25 percent, of $250,000 invested by a group of so-called angel investors - wealthy individuals who invest in promising new technology companies.

George E. Marks was 17 when his father died and he had to work to pay for college. His father was a mailman and then a computer programmer, but that was before programming acquired a workplace aura and an income to match. He left his son only an abiding desire to be financially secure. Marks, now 41 and busy co-owner of Kramer/Marks Architects in Fort Washington, recalls that he first saw real money when he bought a house and sold part of the land around it. It was an aha!

There are a lot of Marvin Weinbergers in America - entrepreneurs who search for money to make their dreams come true. Today, 10 of them are scheduled to make presentations here before about 100 "angel investors," wealthy people who can give the entrepreneurs crucial funding. The event at the Downtown Club, called the Angel Venture Forum, will bring together four groups of angel investors, including some from New York and some from Washington. Private investors are called angels because their investment, often the first outside money a company receives, supplies financial oxygen to a venture that may be gasping to survive.

ON BEHALF of the Private Investors Forum, a nonprofit consortium of 150 accredited private investors and angel investor groups in the Mid-Atlantic Region, I'd like to note that the April 28 special report on the region's entrepreneurs, "Big Thinking," overlooked the Angel Venture Fair and its contribution to the region's economy. The fair, on April 6 at the Union League in Philadelphia, is considered the premier meeting of accredited angel investors and entrepreneurs in the region.

Entrepreneurs and the investors who back them are not the same as Wall Street bankers. This distinction is obvious to you and me, but apparently not to Washington. The Senate financial reform bill, which is being debated this week, lumps these groups together. If it passes in its current form, it will hurt the process that helps turn entrepreneurs' innovative ideas into viable, job-creating businesses. So-called angel investors back early-stage businesses that often consist of not much more than a folding table, a couple of computers, and lofty aspirations.

RESEARCHERS for the Kauffman Foundation surveyed more than 500 founders of successful businesses in high-growth industries to see what they had in common. These are some attributes that stood out: The successful entrepreneur's average age was 40. Nearly 70 percent were married when they started their company, and nearly 60 percent had at least one child. More than 90 percent grew up in middle-class or upper-lower-class families. Their average birth order was second in the family.

Public stock and bond markets got you down? Venture capital is starting to look good again. VC and angel funding have rebounded strongly since 2008 and the financial crisis, and Golden Seeds Fund 2 L.P. , a vintage 2011 fund, is just one example. The fund is focused on making early-stage portfolio investments, such as Cognition Therapeutics Inc., a Pittsburgh life-sciences company, and is building a portfolio of 20-plus investments through 2013. Golden Seeds is a network of angel investors wagering on start-ups at a time when small business needs financing more than ever.

All companies reach for the top, but first they have to get off the ground, often by raising money from investors. That's harder to do in the worst economic downturn since the 1950s, but it is still happening. And the situation is not all bad. "You have less annoying competition," said Brent Matzelle, chief executive officer of Vuzit L.L.C., a start-up based at the University City Science Center in West Philadelphia. Matzelle was referring to a noticeable decline in would-be competitors who put up fancy-looking Web sites that prompt potential investors in Vuzit to question its business plan.

The ideas were innovative. The presentations were sharp. The financial projections were almost certainly optimistic. The region's 12th annual Angel Venture Fair drew about 240 people Monday and Tuesday to Philadelphia's tony Union League - a fitting setting for those who dream of striking it big with the next New New Thing, or at least being one of the Thing's early investors. Owners of 125 companies applied for the chance to promote their ideas to 150 of the so-called angel investors - people with the means to help a new company get off the ground, often because they have themselves cashed in on successful entrepreneurial efforts.

Public stock and bond markets got you down? Venture capital is starting to look good again. VC and angel funding have rebounded strongly since 2008 and the financial crisis, and Golden Seeds Fund 2 L.P. , a vintage 2011 fund, is just one example. The fund is focused on making early-stage portfolio investments, such as Cognition Therapeutics Inc., a Pittsburgh life-sciences company, and is building a portfolio of 20-plus investments through 2013. Golden Seeds is a network of angel investors wagering on start-ups at a time when small business needs financing more than ever.

Angel investors may indeed be all around us, but I'm beginning to wonder if these wealthy investors have enough time to belong to all of the groups that want them as members. That thought occurred to me last week as I watched the inaugural meeting unfold of the Philadelphia chapter of the Keiretsu Forum , an international angel network based in San Francisco. After months of work, due-diligence expert Howard Lubert and financial adviser Vincent Leusner have brought the 21st chapter of the Keiretsu Forum to Philadelphia.

   While those who run venture-capital funds may get more attention, angel investors invest in far more start-ups in a given year.    The National Venture Capital Association cites data from Thomson Reuters that show 728 companies obtained their initial investments from venture funds in 2009 - a total of $3.3 billion invested.    In contrast, 57,225 businesses raised $17.6 billion from 259,480 individuals in 2009, according to the Center for Venture Research at the University of New Hampshire .    However, like the shrinking venture-capital industry, angel investment has also been declining, said the center.

ON BEHALF of the Private Investors Forum, a nonprofit consortium of 150 accredited private investors and angel investor groups in the Mid-Atlantic Region, I'd like to note that the April 28 special report on the region's entrepreneurs, "Big Thinking," overlooked the Angel Venture Fair and its contribution to the region's economy. The fair, on April 6 at the Union League in Philadelphia, is considered the premier meeting of accredited angel investors and entrepreneurs in the region.

Entrepreneurs and the investors who back them are not the same as Wall Street bankers. This distinction is obvious to you and me, but apparently not to Washington. The Senate financial reform bill, which is being debated this week, lumps these groups together. If it passes in its current form, it will hurt the process that helps turn entrepreneurs' innovative ideas into viable, job-creating businesses. So-called angel investors back early-stage businesses that often consist of not much more than a folding table, a couple of computers, and lofty aspirations.

RESEARCHERS for the Kauffman Foundation surveyed more than 500 founders of successful businesses in high-growth industries to see what they had in common. These are some attributes that stood out: The successful entrepreneur's average age was 40. Nearly 70 percent were married when they started their company, and nearly 60 percent had at least one child. More than 90 percent grew up in middle-class or upper-lower-class families. Their average birth order was second in the family.

The ideas were innovative. The presentations were sharp. The financial projections were almost certainly optimistic. The region's 12th annual Angel Venture Fair drew about 240 people Monday and Tuesday to Philadelphia's tony Union League - a fitting setting for those who dream of striking it big with the next New New Thing, or at least being one of the Thing's early investors. Owners of 125 companies applied for the chance to promote their ideas to 150 of the so-called angel investors - people with the means to help a new company get off the ground, often because they have themselves cashed in on successful entrepreneurial efforts.

All companies reach for the top, but first they have to get off the ground, often by raising money from investors. That's harder to do in the worst economic downturn since the 1950s, but it is still happening. And the situation is not all bad. "You have less annoying competition," said Brent Matzelle, chief executive officer of Vuzit L.L.C., a start-up based at the University City Science Center in West Philadelphia. Matzelle was referring to a noticeable decline in would-be competitors who put up fancy-looking Web sites that prompt potential investors in Vuzit to question its business plan.

A Radnor biotechnology start-up has raised a small amount of equity capital, only $3 million, but has managed to get four drugs into development, including two being studied already in patients. Normally it costs tens of millions and takes years to get a drug through preclinical and human studies. But Yaupon Therapeutics Inc., founded in 2002, has speeded up the process by carefully choosing potential products and partnering with academic researchers who have secured millions in government funding.

Since 1999, Steve Christini has been trying to parlay a design project from his senior year at Villanova University into a motorcycling revolution. The idea: an all-wheel-drive system that would give motorcycles a better bite on slippery and uneven surfaces, making them safer to ride. "The cornering on these bikes is unbelievable," said Christini, who for the last few months has been eliciting similar responses from professional riders testing his company's prototype. But tiny, Philadelphia-based Christini Technologies Inc. is in a race with established motorcycle powers to bring the idea to market.