Entrepreneur FAQ's - Australian Angel Investment Network

Entrepreneur FAQ

What is the Australian Investment Network? The Australian Investment Network is an online platform designed to connect entrepreneurs (looking for growth or start-up capital) and angel investors (looking for investment opportunities). The Australian Investment Network is unique in that it offers a local, national and global platform with partner networks across North America, South America, Europe, Africa, Asia and Australasia. The Australian Investment Network is continually growing, developing and updating its extensive database of angel investors.

What is an Angel Investor? Originally, the term “angel” was coined to refer to the people who financed Broadway plays when all else failed. Today this term has become common among the investment community to refer to a high net-worth individual that invests their own personal funds in various businesses. In Australia, it is estimated that there are well over 200,000 potential angel investors that annually invest approximately $500 million in Australian businesses and currently own over $1 billion in existing equity. This represents roughly 7% of what the banks are investing. As well, statistics show that this figure trumps that of venture capital lending. The Australian labour market and productivity centre estimates that angel investments have financed approximately twice as many firms as any other form of external equity investment, including institutional venture capital.

Who is a typical Angel Investor? Angel investors are often retired entrepreneurs or executives, who may be interested in angel investing for reasons that go beyond pure monetary return. These include wanting to keep abreast of current developments in a particular business arena, mentoring another generation of entrepreneurs, and making use of their experience and networks on a less-than-full-time basis. Thus, in addition to funds, angel investors can often provide valuable management advice and important contacts.

What is the difference between an Angel Investor and a Venture Capital firm? Angels make their own decisions as opposed to a board or group of people making a decision for investors that have pooled money together. Angels tend to be more involved in the businesses that they invest in and provide assistance in ways that venture capital firms do not. Angels typically do not own as large a stake in the company as a venture capital firm would. Another benefit of being an angel investor is the reception of certain tax incentives from investing in Australian controlled small businesses.

How much does it cost? You have two payment options: The Investor Referral Fee and The Premium Service Fee. More information can be found on Our Rates Page. Please note there are no further fees or commissions to be paid.

Why isn’t it free of charge? Many people have asked us why we charge entrepreneurs for the service. Firstly we are running a commercial enterprise and don’t get any public funding, so we need to cover our admin and promotion costs, pay staff to check your submission and pay for the upkeep of the website. Secondly we are providing a valuable service to the entrepreneurs who need the much needed to support to get their ideas in front of investors. To set up a serious business with outside funding you do need to be prepared to spend some money. The fee is very low compared to other companies in the industry who will often charge around 5% of the amount you wish to borrow.

Do I have to pay for every contact? No, both the Investor Referral Fee and The Premium Service Fee give you to access to the contact details of ALL the investors who wish to contact you. Your proposal remains active for 90 days and all investor contacts are included in this period. You do not need to pay for each contact.

Why don’t you take a success fee instead? If you think of Angel Investment Network as the funding equivalent of an online dating agency it makes more sense. You wouldn’t expect a dating agency to only get paid if and when you marry the partner you found on their site. They wouldn’t be able to find you or know you were getting married without employing a private detective! Likewise we can’t hope to individually track everyone who enters their idea over the internet. Often all we have is an email address for you. Plus we have no control over how good your idea is and therefore your likelihood of finding an Angel. There may be a few Angel groups who don’t charge upfront, but they heavily screen incoming ideas and reject about 90% of them, which means most people are left without a chance of connecting with Angels.

How do I pay the Premium Service Fee? First you have to submit an investment proposal. After you save your proposal you will be directed to your member’s area. There will be a link above your proposal to pay the Premium Service Fee via credit/debit card or PayPal.

How do I know if my proposal has been received? You will know that your proposal has been received if it appears in the list of "Active Proposals" in your member's area. If there are no proposals in your member's area then you will need to resubmit your proposal. Always write your proposal in another programme and cut and paste to avoid the page timing out.

Why isn’t my proposal appearing in the list of recent proposals? If you have just submitted your proposal, it is probably because we haven’t approved it yet. We have to read and activate each proposal before it is released to the investors. Alternatively it may be because you have just edited your proposal, which means that it is removed from the system until we reapprove it.

Does my company have to be established? No, we accept projects at every stage of development – from ideas to start-up companies to mature businesses. Even if your project is still an idea, it could still be of interest to the investors. They might even have the relevant knowhow and expertise to get the ball rolling.

Is there a maximum/minimum investment? No, our investors are interested in projects ranging from a few thousand dollars to millions of dollars.

Are the contact requests automated? No, all the contact requests you receive are from investors who have read your investment proposal and decided they want to discuss your project in more detail.

Who are the investors on this website? The investors on our website have been compiled from databases of angel investors, company directors and private investment groups. They also include individual investors who have registered in the hope of finding investment opportunities. Our database is continually expanding with new investors looking to invest in companies like yours.

How much information should I include in my proposal? If you are worried about confidentiality we would advise you not to give away too many details in your proposal. Try and write enough to get the investors interested in your project without revealing the key ideas. After you pay the Referral Fee or Premium Service Fee we will give you a free NDA document, which you can get all the potential investors to sign before presenting your idea in full.

How is my privacy protected? The site was developed using proprietary database management tools and a secure server is used to assure that no one sees your business or personal information. Your information is not offered to any third party for any purposes and is guaranteed to be kept confidential and private.

Why should I use this service? As an entrepreneur, you are already aware of the growing resistance of banks in Australia to finance small business. It is virtually impossible to obtain financing without having secured assets, providing personal guarantees, etc, etc. Angel investors are the logical source to provide financing to small business. With $1 billion invested annually in Australia and growing all the time, the main obstacle is locating and presenting your idea to this large group of investors. The Australian Investment Network allows an entrepreneur to:
a) Find a source of capital.
b) Find an experienced investor that can provide guidance and support.
c) Make it all come together in a fast and efficient way.

How will I attract the attention of potential investors? When dealing with an angel investor, at the very least your proposal should address the following:
- How much money do you need?
- Why do you need it?
- When do you need it?
- What are you willing to give up to get it?
- When and how can you pay it back?
Investors need your answers to these questions before they will even consider helping you. They are not looking for "pipe dreams" or unprofessional sounding proposals. They expect a reasonably sound business plan as well as an understanding from entrepreneurs that an investor is not going to just blindly hand over significant sums of money with no strings attached whatsoever. They may be angels but there are limits to what they are prepared to do.

How can I pay if I don't have a credit card? If you are unable to or feel uncomfortable using a credit card, you can pay by PayPal, MoneyBookers or bank transfer. If you want to pay by PayPal there is a link above your proposal. If you want to pay by MoneyBookers or bank transfer, send us an email and we will give you our account details.

Why am I being asked to pay again? You have to pay the Referral Fee or Premium Service Fee for every proposal you submit.

Due Diligence Please be aware that after the initial match has been made it is the entrepreneur's responsibility to carry out diligence on the investor. Please inform us of any suspicious behaviour.

I have other questions, who do I contact? Contact us by email: admin@australianinvestmentnetwork.com

Australia > Queensland

$50,000 to $1,000,000

March 10, 2010

I am a 34 year old married entrepreneur living in Brisbane that now has means to invest in other companies etc. I am an owner manager of a business that operates in Queensland, I have a bachelors degree and have investments in Mortgage Broking companies along with investment properties. I have experience in Wholesaling and business management and am a keen individual investor. Involvement will be on a per case basis.

Australia > New South Wales

$50,000 to $200,000

March 9, 2010

I am a Sydney based individual professional Investor. I have an MBA and my professional background is in the financial markets. I invest in the financial markets professionally full time on my own behalf as well as having some private equity investments. I am happy to fully involve myself in any business I invest in on a "needs be" basis.

Austria > Großgmain

$500,000 to $2,000,000

March 8, 2010

I am a individual investor. Age 37. Living at the moment in Austria. We will move back to Australia (My wife is Australian). I worked as consultant at PricewaterhouseCoopers. Last position was Country Finance Manager for a Swiss company.

Australia > New South Wales

$0 to $10,000

March 7, 2010

Individual investor with background in customer service, technical support, project management and business analysis. Interested in being a hands-on investor for start-ups.

Australia > New South Wales

$50,000 to $500,000

March 7, 2010

Professional American investor with global interests, residing in Australia for 10+ years. Experienced in diverse range of commerce, but will bring significant value to the company, both financially and advisory, as we properly structure and capitalise your business to allow for continued and sustainable growth. Will be active at director level, allowing management to drive day-to-day process.

United Kingdom > London

$5,000 to $100,000

March 7, 2010

31 year old IT consultant. BSc (computer), BEng(elec). Individual silent investor.

Australia > New South Wales

$0 to $500,000

March 4, 2010

Interested primarily in internet/IT related investments. Experience starting and running successful internet businesses.

Australia > New South Wales

$1 to $200,000

March 4, 2010

N***** offers extensive experience in the management and growth of small to medium enterprises, start-ups, expansion and high growth businesses in the Asia Pacific region and other international markets. The management brings together an in-depth knowledge of consumer, retail, business to business, services, technology, creative and digital media markets, as well as broad knowledge and key vertical relationships throughout the supply chain. The depth and breadth of management experience enables us to add significant value to companies in capital raising, finance, strategy, planning, operations, sales, marketing, business development and general advisory and non-executive roles.

Australia > New South Wales

$50,000 to $1,000,000

March 4, 2010

I am 60, married, live in Sydney. 40 years professional experience (25 at board and management level). Skills include IT, telecoms and power engineering, management, sales and marketing. 15 years principal of consulting/advisory company Enterprise Growth Partners, 3 years Associate with Gramercy Venture Advisors, 3 years CEO of Simplecomputing Australia, 2 years Operations Manager with AWA, 6 years R&D Manager with JNA and NetComm Australia and 10 years Senior Engineer with Telstra. BSc in Elec Eng from Salford Uni in England. Diploma in Company Directorship from Sydney Uni. My investments are small positions in Gramercy Venture Advisors, MasterSoft and Enterprise Growth Partners, however have been involved in acquiring investments up to $2m. I have contacts throughout the Australian investment and technology community. I will mainly be an advisory partner. Could be hands-on with key investments. My status is as advisor and individual investor who can introduce other investors.

Australia > Queensland

$20,000 to $50,000

March 1, 2010

Personal info: 32 years old, married, based in Brisbane Professional experience: Since Nov08 working for QLD Energy company, currently as senior trading and commercial analyst, establishing energy trading capability within company and working on other commercial agreements. Prior role responsible for risk management, Internal control and insurance within the same company. Before that worked for 6 years for Shell Trading mainly in London, working in contracts, analyst and front line trading functions. Education: Bachelor degree in International Business Limited private investment experience, main investment experience has been with the companies I worked for and related to real estate. Involvement: flexible hands-on, advisory or silent Status: individual investor

Australia > Victoria

$10,000 to $100,000

February 27, 2010

Age 59. Consultant to the gambling industry. Senior Executive. B.Eng (Hons).MBA. Silent. Individual investor.

Australia > Victoria

$10,000 to $100,000

February 27, 2010

Age 59. Senior executive in gambling industry. Tertiary education. B.Eng (Hons). MBA. Financial Planner. Business entrepreneur. Silent partner. Individual investor.

Australia > New South Wales

$500 to $1,000

February 26, 2010

I am 32, single, living in Sydney. I am looking for investment opportunities in the business sector of all categories. My involvement will be aimed at being silent. I have limited experience with starting businesses of my own. I am looking for entrepreneurs and small business people who are looking to start up or need some additional small capital to expand their existing business.

Australia > Queensland

$1 to $10,000,000

February 24, 2010

Company Director specializing in the importation and national distribution of audio visual accessories to the Australian market place. We ship over 4500 shop fronts and have an extensive distribution infrastructure in place with 75 staff. We are seeking partnership and acquisition and venture capital opportunities to increase our revenues and market dominance.

Australia > Queensland

$1 to $1,000,000

February 24, 2010

My family and I are situated on the gold coast Australia. I consult for mining company which requires me to travel often. I own several businesses some as partnerships and other outright but my main income source comes from share and option trading. I have always been active in any business that I have invested in either through direct involvement or as a advisor but in the right situation would be willing to take on a silent roll. I am looking for investments as a individual but also have access to family trust for the right investment.

Australia > Victoria

$10,000 to $100,000

February 22, 2010

Personal : 51, married, Melbourne Professional experience: Chartered Accountant, CFO, GM and director positions in blue chip companies in Australasia, Asia and Europe. Currently Principal of a management consultancy. Education: BMS, Grad Dip Mktg, CA, CMA, ACIS Investment experience : Across a number of industries up to A$500k Other value-adds (e.g. experience, expertise, contacts, etc.) Management consultancy specializing in critical decision review (sanity checks) for C level executives. Anticipated involvement : Depends upon opportunity Status: Potential investor, advisor, consultant or director.

Australia > New South Wales

$100,000 to $2,000,000

February 22, 2010

CEO of Maxidor South Africa for last 25 years and CEO of other businesses in the group. Businessman of the year for 2004/5, Want hands-on involvement if possible but happy to advise from the sideline. Just moved to Sydney, NSW and looking to build a business group similar in size to that in South Africa (See www.maxidor.com)

Australia > New South Wales

$10,000 to $5,000,000

February 22, 2010

Practising Public Accountant. Considerable business experience and Connections. Anticipated involvement, JV, hands on, advisory. Individual investor with access to associate investors.

Australia > Western Australia

$0 to $200,000,000

February 22, 2010

O**** Group is a full-service independent corporate strategy and corporate financial advisory practice operating throughout the Asia Pacific region. We specialise in assisting middle-market clients in all major industries with strategic transactions such as capital raisings, divestments, and acquisitions. Our approach is to roll our sleeves up and work closely in partnership with our clients providing practical, value-adding advice and solutions to ensure the successful completion of every transaction.

United States > Pinole

$1,000,000 to $10,000,000

February 21, 2010

I run a US based Angel Investor group with two chapters in Palo Alto and Reno. We made 8 investments in last 12 months. I also have access to a worldwide network of investors, and I also invest personally. We seek high returns investments only (IRR = 25% and up).