DU Angels will help startup companies gain access to seed and Series A capital to help businesses grow and scale their operations and marketing to gain traction, Gash said. The capital required goes beyond dollars and cents and includes human capital, defined as investors’ time, talent, expertise, and networks.
“The goal of the group is ultimately to identify the most promising early-stage companies — high-growth, high-potential companies — and provide capital to them, both monetary and human, to unlock value and drive ROI for all of our stakeholders and the founders as well,” said Caroline Gash, DU Angels’s managing director.
DU Angels is professionally staffed and managed by a group of DU alumni with deep industry experience. Managers and board members bring a collective 70 years of angel investing and entrepreneurship to the organizations they have founded or invested in for over 100 companies during that time.
Angels Give Startups a Leg Up
Startup businesses that receive angel investments are up to 25% more likely to survive after four years and up to 19% more likely to have grown to 75 employees in that time period, according to a 2016 study by the Ewing Marion Kauffman Foundation, a Kansas City, Mo.-based nonprofit organization that works with communities in education and entrepreneurship.
DU Angels is based in Denver, Colorado, but can work with startup companies and investors throughout the country.
DU Angels currently has 20 members and doesn’t plan to make any investments until that number has reached 30. The group has a goal of reaching 60 members by the end of the year. Laughlin expects the group will make its first investment by the end of the first quarter of 2021.
Each member has signed an agreement to invest at least $25,000 annually. Members can choose to invest it all in one company or divide it among several. The minimum the group will invest in a startup is $150,000.
“If we can’t drum up a minimum of $150,000 from our members, we will forgo that investment, but that doesn’t mean our members can’t invest in that company if they drum up the capital,” said Sarah Laughlin, director of investor relations for DU Angels. “We are putting the most promising startups in front of our membership for evaluation and funding.”
DU Angels is looking for startups with a strong team of founders — not individuals — who are either entrepreneurs or have deep experience in their industries and already are generating revenue unless it’s something like a medical device company facing regulatory hurdles.
The organization, which doesn’t plan to lead funding deals, is looking to invest in rounds between $1 million and $10 million. It will participate in both seed and Series A rounds if a lead investor has been identified.
“We’re looking for startups that already have a lead investor in place,” Laughlin said.