From Triangle Angel Partners website and WRAL Tech Wire
Startups in the Research Triangle now have an additional source of funding. Triangle Angel Partners, formed by more than 40 individuals from the area, has raised $2.3 million for investment in the Triangle.
Backers include Rich Lee, the former owner of Hosted Solutions which he sold
to national telecommunications provider Windstream Communications.Craig Stone, an entrepreneur himself who has built HireNetworks into one of
the area’s most successful employment services firm, is also among the
founders.
Merrill Mason, a partner at the Smith Anderson Law Firm, and Rich Harris,
managing director of Synergy Commercial Advisors, also helped launch the new
fund.
Startup capital is one of the most difficult sources of funding for new
companies in the Triangle to attract. Angel investments often help new
companies grow to the point that they have products and revenues, two factors
crucial in attracting institutional capital from venture capital firms.
Early-stage funds in the Triangle include NC IDEA Fund Partners and Southern
Capitol Ventures. Intersouth Partners, the southeast’s largest venture firm,
also will make early-stage deals.
The angels in TAP includes a mix of high net worth individuals, some of whom
are entrepreneurs and experienced investors themselves.
“This group was formed to leverage our networks and gain access to the vast
amount of deal flow in this area,” Stone said in a statement. “We are all
passionate about entrepreneurship and look forward to helping our companies
succeed.”
TAP investors also plan to be actively involved in startups from roles on
boards to serving as advisors while also providing links to venture firms and
other angel networks.
Eric John serves as the fund’s manager.
TAP plans to have meetings on a monthly basis where startups will be
interviewed for potential investment. Companies first have to be screened
through a selection process set up by TAP.
Investment Criteria
The fund’s investment criteria as spelled out on its website:
Management Team
We look for teams of high-quality entrepreneurs with a track record of
leadership and performance, either in the company’s specific industry or in
prior entrepreneurial ventures. We also look at your team’s passion for and
commitment to the new business idea, and your ability to inspire confidence
among future stakeholders, including employees, potential customers, and
investors. As we will be working together as partners, your team’s credibility
is essential. In addition, your team must be open to and comfortable with
receiving input provided by angel investors.
Market Opportunity
Your company must demonstrate a strategy to claim significant share of the
target market. There are plenty of great business ideas, but not all businesses
will generate returns that justify angel investor and venture capital
financing. Therefore, providing a solution to a problem with a large potential
market is essential.
Use of Proceeds
Funds must be used to accelerate your company’s achievement of key
milestones that increase the company’s value. We generally fund activities that
include research and product development, building a sales and marketing
infrastructure and hiring key executives.
Growth Potential
We look for companies that can grow quickly and manage the scale necessary
to succeed. Your company must demonstrate a plan to generate significant profits
beyond the initial product idea. Do you have a strategy to achieve multiple
sources of revenue? We also require well-conceived financial projections, based
on sound assumptions, demonstrating consistent profits and cash flow growth.
Competitive Advantage
Your company must have some proprietary features that distinguish you from
potential competitors or provide barriers to entry that prevent other companies
from capturing your customers with a similar offering. Attributes that convey
competitive advantage include intellectual property protection, exclusive
licenses, exclusive marketing and distribution relationships, strong brands,
scarce human resources (i.e. knowledge and skills), and access to scarce raw
materials.
Fit
TAP members have significant executive experience in a variety of fields.
One of the benefits of working with angel investors is the active coaching and
contact network that such investors can provide. As such, there must be a fit
between members of our group and your idea.
Technology
We prefer to invest in first-of-a-kind new
ideas, rather than incremental enhancements to existing products and services.
However, we approach highly complex, esoteric technologies with caution. The
concept behind the technology must be proven and verifiable. Further, we avoid
science projects that don’t demonstrate a clear path to commercialization. Any
breakthrough innovation must be accompanied by a strong business plan.
