links for 2008-04-26

• Information Arbitrage: The Halcyon Days of Entrepreneurship

Maple Leaf Angels Closes Well(.ca)

It is with great pleasure that I announce that Toronto-based Maple Leaf Angels has closed its 9th investment with its funding of Well.ca, Canada’s largest online non-prescription drugstore. For the newswire announcement, please click here.

Shipping to every province in Canada, Well.ca, based in Guelph, Ontario is growing at a rate of 35% per month, lists over 10,000 products online, and receives more than 100,000 hits per day. Though they do not sell prescription drugs, Well.ca ships over-the-counter medications, diabetic supplies, medical supplies, ostomy supplies, personal supplies, cosmetics, and more.

As noted by Jonas Brandon at StartupNorth.ca, the Toronto tech community are all quite excited about the success of Well.ca CEO, Ali Asaria, in turning Well.ca into Canada’s favourite online drugstore.

This investment by Maple Leaf Angels also marks a significant milestone for the Angel group, having, since inception in 2007, invested $4 million in 9 high growth companies.

Congratulations, Well.ca and Maple Leaf Angels, for both reaching such significant milestones!

The Team: The Ability to Listen and to Change

In the April volume of the NOEG Link newsletter, a quarterly report for entrepreneurs, Angel advisors, and their professional advisors, National Angel Organization President, W. Daniel Mothersill, is featured as a guest author.

In his article, The Team: The Ability to Listen and to Change, Dan examines the critical role the ‘Team’ plays in early stage company development.

Given that 60% of high-potential company failures result from the failure of the leadership team to execute the business plan, it is imperative that start-ups pay close head to the importance of establishing this most important part of their business foundation.

To learn more, please click here.

Canadian Angel Convoy to visit EBAN Congress in Arnhem, Netherlands

The National Angel Organization is happy to report that several of its members will be attending this year’s European Business Angel Network Congress 2008 in Arnhem, Netherlands on April 15th and 16th.

Joining the Canadian Angel convoy will be Cathy Favre (Newfoundland and Labrador Angel Network), Ross Finlay (First Angel Network), Matey Nedkov (Maple Leaf Angels), and NAO President W. Daniel Mothersill.

The group is excited to see, first-hand, all of the great progress that has been made overseas in the business Angel sector. As well, it is shaping up to be a great venue to discuss and share best practices, co-investment models, networks, and our very own Canadian success stories!

We will provide full feedback from the convoy after the conference. Stay tuned!

Further information on EBAN Congress 2008 can be found at www.eban.org.

East Coast Angels at Work!

Over the last couple of years the First Angel Network, an affiliate member of the National Angel Organization, has taken the East Coast of Canada by storm, pulling together 76 members who have deployed almost $3 million into local high-potential companies.

The article, Angels at work on East Coast, in the Chronicle Herald on Sunday April 6th, 2008, provides an excellent history of the genesis of this successful Canadian Angel group.

Not only do Angel groups tend to give their members better returns, but also they give high-potential companies a single portal through which to access many investors at once. It is out of this vein that FAN was sprang:

[Brian Lowe and Ross Finlay] had just finished raising $1 million in private equity for ImmunoVaccine Technologies, a Halifax biotechnology company of which Lowe is vice-president. That endeavour involved pounding the pavement and cold-calling potential individual investors.

“(We thought) it would have been a lot easier if there had been a network that we could have gone to,” Finlay says during an interview over coffee at the association’s sparsely furnished headquarters in downtown Halifax.

“So we decided, well, why don’t we do it? Nobody’s done it. Why don’t we give it a shot?”

The formalization, organization and coordination of the Angel investment industry, an industry that represents roughly $3.5 billion in investment in Canada annually, has become central to the success of Angel investing in this country. With over 30 Angel investor groups spread throughout the country, and more coming on-line, groups such as FAN are in good company.

The National Angel Organization is certainly looking forward to bringing Canadian Angels and Angel groups from around the country together at our Annual Summit in Halifax this year!

Once again, congratulations Ross and Brian on your success with FAN!

23rd Angel Forum on April 29th!

NAO Board member, Bob Chaworth-Musters, will be hosting the 23rd Angel Forum in Vancouver, BC on Tuesday, April 23rd.

30 pre-screened companies will be at the event seeking the value-added investment of Angel investors.

Not only is the event a great way to see potential investments, but it also a fantastic networking opportunity for Angel delegates.

This event has been a success for over 10 year’s (founded in 1997) and had raised over $26 million for companies(!)

Please be reminded that registration closes on April 15th, so please follow the link for further details and registration:

***Angel Forum information and registration***

links for 2008-04-09

• Age of the Angel Investor « EP Enterprises
  The point here is that many can now reach more milestones with less cash than ever before, giving Angels a much more significant role to play in the commercialization of world-class Canadian technology.
  (tags: angel)

Canadian Angels: By The Numbers

The Canadian Angel investor community is rapidly coming into its own, with new Angel investor groups being started and co-investment and collaboration taking place across this great country of ours.

To keep all of our stakeholders informed, NAO is going to be starting a new blog series, Canadian Angels: By The Numbers.

This monthly release highlights the activities of Angel groups throughout Canada, showcasing the ways in which the Canadian Angel community is helping to commercialize our Canadian technology and develop world-class companies.

So, watch this space! More information coming soon!

Angels As Key to Collaborative Commercialization in Canada

An Industry Canada study recently crossed my desk. Released May 2007, the study, Case Studies of Collaborative Innovation in Canadian Small Firms, focused on network-centric innovation and commercialization.

I was highly encouraged to see Angel investors not only identified as stakeholders in this network-centric model with respect to early-stage company finance, but recognized as indispensable to solving the growing funding gap issues high-potential Canadian companies face. Even more encouraging was the recognized need to implement incentive structures that foster Angel investment.

“There is a gap in financing spinoff companies during the phase between incorporation and the point when revenues are generated from sales. The most likely source of additional funding would be angel investors, who would require the requisite incentive structures.”

“Institutional capital in Canada is sometimes not well suited to financing emerging technology companies both because of a lack of understanding of the technology and because companies at this stage of development often do not progress as fast as they would like. The solution to this gap may well lie in angel investors, provided they can be given greater encouragement to fill this specific need.”

In Canada Angel investors invest about $3.5 billion a year; nearly twice the amount formal institutional Venture Capital invests annually. Unfortunately, the Angel industry is rather decentralized. Angels, because they work as individuals or as members of Angel groups, often do not get the recognition they deserve as the investors on the bleeding edge of commercialization and company acceleration, underwriting companies at the time of their greatest risk.

The National Angel Organization, the industry organization devoted to developing a robust Angel investor community in Canada, has long recommended that both Provincial and Federal governments adopt an Innovation and Productivity Tax Credit (IPTC) to encourage Angel investment by offsetting some of the risk they face when investing in such early-stage companies. Such programs have been adopted in the UK, many US States, and a number of Canadian Provinces.

Along these same lines, I am happy to announce that Manitoba has recently adopted a program similar to the IPTC that has successfully run in British Columbia and other provinces in Canada.

“Angel investors in Manitoba are extremely pleased that the province has now formally approved its new tax credit system for private start-up investments.” said Ken Cooper, Managing Director for the Winnipeg Angel Organization. “This will really help balance the extra costs of documentation and liquidity – not to mention risk – which investors face when considering private equity deals. We’re already seeing increased interest in start-up deals because of it.”

Congratulations, Ken, from the National Angel Organization, on your success! I am gratified to see that the need for incentive structures that foster Angel investment is beginning to resonate more strongly both Federally and Provincially.

Fullsail Summit Promotes Growing Capital Markets in New Brunswick

NAO Board Director, and Capital Market Specialist, Michael Arbow, is heading up this year’s Fullsail Summit in Saint John, New Brunswick on April 6th-8th, 2008.

So, what exactly is the Fullsail Summit?

Fullsail Summit 2008 is focused on inspiring delegates to be part of growing New Brunswick’s capital markets and building on the momentum we’ve experienced since last year’s event. By celebrating our successes to-date, reviewing measured results, and developing actions for next steps, delegates will see what has been accomplished throughout the year and what is possible as we continue to work with stakeholders toward achieving economic prosperity in New Brunswick.

Delegates attending the Summit will be empowered to develop solutions and implement change. They will have the opportunity to create an action plan charting the way for the successful completion of their chosen recommendations.

The Summit goals and objectives are simple – to EDUCATE, INSPIRE, and ACT.

For more information on speakers and registration, please click on the graphic below:

Fullsail is an initiative of the
New Brunswick Securities Commission.

links for 2008-04-04

• Don Dodge on The Next Big Thing: Angel Investors put $26 Billion in 57,000 companies
  US Angels invested $26 Billion in 57,120 companies, up slightly from last year. The report says there are 258,200 active angel investors in the USA. By comparison, Venture Capitalists invested to $29.4B in 3,813 companies in 2007.
  (tags: angel aca angelgroup)