Angel Investment Networks
The Angel Investment Networks Cluster aims to increase capacity and scale of angel investment activity in frontier and emerging markets, with an ultimate goal of increasing the number of investments into start-up and early stage enterprises. The areas of focus include supporting new angel investing initiatives by working with high potential angel network founders and leaders to launch and formalize angel activities, building capacity within early stage networks, and scaling up existing operational networks.
WHY IT MATTERS
Angel investing involves High Net Worth Individuals (HNWIs) such as successful entrepreneurs, corporate executives, industrialists, seasoned investors and other professionals investing their own capital (and time) into startup and early stage businesses in which they have no personal connections. They provide capital at the seed and early stages of a company’s development, often before venture capital. In addition to capital, angels provide expertise – such as technical knowledge, industry or market-specific insights, and useful networks – which is a defining feature of their value proposition in the wider entrepreneurial ecosystem.
Working together, angels are able to identify better deal flow by leveraging their networks, share the due diligence and post-investment workload, pool capital to deploy across more companies and diversify their risk through portfolio strategies.
Despite the critical role that angel investment networks play in financing small and growing businesses, particularly at their early stage, they face a number of barriers to launch and growth:
Limited understanding of suitable operating structures, business models and member services for angel networks/groups, resulting in largely informal activity or stalled angel network/group initiatives;
Lack of technical investment capacity in conducting due diligence, negotiations, deal structuring and post-investment management, resulting in few completed investments
Limited know-how/capacity among network managers to formalize and scale angel investment networks
EXISTING EFFORTS UNDERWAY
African Business Angels Network – A Pan-African non-profit association supporting the development of early stage investor networks across the continent and to grow the cohort of early stage investors excited about the opportunities in Africa
Collaborative for Frontier Finance’s cluster on angel investment networks – A group of networks, thought leaders, and funders focused on increasing capacity and scale of angel investment networks in Africa
HOW CAN I GET INVOLVED?
Learn more and share your work with the Collaborative for Frontier Finance:
- Share your work with CFF (e.g. research, reports)
- Reach out with questions and ideas via firstname.lastname@example.org