Investors

The Arizona Angels Investor Network is an organization run by investors for investors. We focus on private equity investments in high growth companies based in, or with connections to, Arizona. Most communications are via email. Meetings are held monthly. Our members are all experienced accredited investors who understand the risks and potential rewards of investing in private companies.

If you are interested in becoming a member of Arizona Angels, please drop us an email at investorapplication@arizona-angels.org.

MEMBER BENEFITS

Qualified Dealflow. One goal of the Arizona Angels is to see the best private companies Arizona has to offer. Although many apply, only companies screened that fit the Arizona Angels investment criteria are forwarded on to members. Members are encouraged to lead investor or refer attractive opportunities to the Angels to enhance dealflow to all members.

Increased Capital/Diversification. One of the most significant risks of Angel investing is raising enough capital to provide time for the company to become profitable or reach necessary milestones for follow-on investment. We help "lengthen the runway." By gathering a larger group of investors, the Arizona Angels enable companies to raise larger amounts of capital at the angel round. This occurs without requiring passive investors to individually contribute a significant amount to any one particular company. Should an investor choose to invest in more companies as a result, this diversification reduces the risk of the investor's portfolio of Angel investments.

Valuation/Terms. The Arizona Angels are able to consolidate local investors' deal flow and speak, via a lead investor, with a single voice. By offering the capital and connections of all members via an efficient process and clean deal structure, a lead investor is able to negotiate more attractive terms and valuation with applicant companies.

Investment Follow-Up/Reporting. After a transaction closes the lead investor, and possibly other members, will typically take a seat on the company's board of directors. These members will have made a significant financial investment in the company and/or have extensive knowledge and experience in the company's industry. In addition to assisting in the company's growth and typical board duties, the lead investor will be responsible for ensuring the company meets its reporting requirements and for assisting in the distribution of this info to all investor Members.

Networking. Members have the opportunity to meet other successful local business leaders (active and retired) at Angel events. Events are for accredited investors only. The Arizona Angels interact with service providers and potential management candidates through other channels.

FREQUENTLY ASKED QUESTIONS

1. How do I apply to become a member? First drop us an email at investorapplication@arizona-angels.org and we will then send you an application. All members are required to be: (1) accredited investors, (2) sophisticated investors, and (3) recognized by the Arizona business community as having reputable business ethics. The Advisory Committee will notify you after making their decision (please be patient as that may take several weeks).

2. What are the financial requirements? All members are required to be "accredited investors" as defined by federal securities law (over $1M net worth or over $200k annual income for the prior 2 years). Angel investing, however, is inherently very risky. Most companies require a minimum investment of $25k. To lower risk and increase the chances of investing in a successful company, a diversified portfolio of 10+ angel investments made over 2-3 years is recommended. Because many investors allocate less than 1-15% of their investment assets toward alternative investments (like angel or venture capital investments), individuals applying for membership should have a minimum of $2M in net investment assets.

3. Why must I send a resume with the application? To maximize the chances of making successful investments, we request the assistance of members at two points in the process: (1) to help review the top candidates, and (2) to assist portfolio companies in achieving key business milestones. This may be as little as reviewing an executive summary for 5 minutes and making a call to an old business contact. Or it could be as much as detailed due diligence calls and active board participation as a lead investor. To enable the Managing Directors to tap these resources when appropriate, resumes are requested of all members. Over time members get to know one another better through networking at Angel events. Should you prefer to be a passive investor, please indicate this on your application.

4. What are the costs of membership? We are a low overhead organization, run by investors, not administrators. To help cover overhead expenses, an annual membership fee of $200 is charged to all individual members. No fee is charged to institutional members if they agree to share deal flow. All members pay for their meals at dinner meetings (typically $45).

5. Who are the current members? We have two types of members: individual and institutional. All individual members are accredited investors and have strong business/investment experience. Institutions include venture capital funds, corporate venture investors, incubators and other angel groups. The Arizona Angels have over 100 individual and institutional members. Members generally fall into one of three categories: (1) Financial - former or current venture capitalist, investment banker, commercial banker, etc., (2) Technology - semi-retired entrepreneur that sold prior business or executive at large technology company that cashed in options, or (3) Traditional Industry - former or current owner of real estate, manufacturing, service or other traditional business. Members can elect to be active (review applications for sponsorship, assist in due diligence, etc.) or passive (attend investment meetings only).

6. What about service providers and job seekers? Membership in the Arizona Angels Investor Network, Inc. is for accredited investors only. New members are welcome from any industry or background. However, all individuals applying for membership are required to acknowledge the organization's Rules of Membership and Conduct, which prohibit solicitation of business or employment from members or applicants. Service providers (attorneys, accountants, business consultants, web & IT consultants, PR firms, recruiters, etc.) seeking business opportunities and individuals seeking management positions are encouraged to review our Professionals Section. Applicants seeking assistance in a particular area are often provided references from that database.