Entrepreneur FAQ

• What is the Canadian Angel Investment Network?  The Canadian Angel Investment Network is Canada’s premiere matching service for entrepreneurs (looking for growth capital) and angel investors (looking for investments). Created by a committed group of professionals formerly involved in business acquisition consulting, information technology and government.The creative concept and foundation of this network was developed to take Canadian business to the next level. The Canadian Angel Investment Network is continually growing, developing and updating it’s extensive database of angel investors.
• Why should I trust this website ? This site is run by completely independant management that has no links whatsoever to any other Investment or Entrepreneur oriented organization.We are incorporated under a Canadian federal corporate charter. We fervently believe in the objectives of this service and are focused on ensuring credibility and commitment to our customers at all times. The website is the result of a significant financial and intellectual investment by its management over a long period of time. It is continually being upgraded and improved.The modest fees that are charged for our service represent only a small fraction of the total investment that has been made and in no way could be considered a "quick buck" operation. A number of professional journalists have written articles in various reputable magazines which attests to the validity and sincerity of our service.These may be reviewed in the "news" section of this site. In order to qualify for the Internet Secure credit card processing service that we subscribe to we had to meet very strict financial and operational requirements. They do not authorize untrustworthy entities to use their service. Finally, any fees paid by Entrepreneurs are eligible for our generous refund policy should a legitimate Investor contact not ultimately happen.
• 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 Canada, it is estimated that there are well over 200,000 potential angel investors that annually invest approximately $3 billion in Canadian businesses and currently own over $12 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 Canadian 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.
• What is an Angel Investor Profile?  Angel investors are individuals who invest their own capital in fledgling businesses, both in the technology and non- technology areas. Research by Allan Riding at Carleton University shows that such individuals typically have run their own small businesses, have significant net worth and income, tend to be college-educated, and are extremely discerning in the projects that they will invest in (rejecting, on average, approximately 97% of the proposals submitted to them). Angel investors typically invest in a business after the entrepreneur's "love capital" (capital from relatives and friends) has been exhausted, but before the firm has reached a stage at which it will be eligible for venture capital investment. Angel investments typically range from about $10,000 to $150,000, although investments may range upwards of $500,000. Professor Riding's research also indicates that, historically, most angel investors seek to invest close to home-within a 150-km radius of where they live.
• What is the difference between an Angel Investor and a Venture Capital firm? Generally, angel investors do not invest in deals over $1 million, whereas venture capital firms typically do not look at deals under this amount. 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 Canadian controlled small businesses.
• How does the service work? Entrepreneurs register on the site and enter an investment proposal summary. There is no charge to submit the summary. Once the information is entered, our proprietary system will identify and forward this to all potential investors that match the criteria. The investors will then decide whether they wish to review your entire business plan and possibly invest in your business. You are then notified that we have identified at least one match of an angel investor (there could be several matches). You are then required to pay (on-line) a one time fee of $199 by major credit card. Once payment is received and verified on-line, you will receive the contact information of the angel investor. At this point, both parties will work together to negotiate an investment deal. The Canadian Angel Investment Network does not charge any other fees for this service and is strictly a matching service bringing together qualified angel investors and serious entrepreneurs.
• Who are the Angel Investors? The angel investors that have registered on our website have been compiled from databases of company officers, various professional advisor sources as well as private investment groups that are looking for alternative investments.Angels are seeking these alternatives more than ever due to the recent poor performance of the stock market.The site is continually updated with new angel investors who are pleased about the possibility of finding investments in such an easy and efficient way.
• What are the costs? There are no costs as an entrepreneur to enter the investment summary on-line in hopes of finding an angel investor to finance the start-up or growth of a business. You pay only when an angel investor is identified and has expressed interest in your business and would like to take a serious look at the concept and terms offered. Once feedback is received from one (or more) of the investors, you then have the option to pay a fee of $199 to make contact with them. The search may provide one or several angel investors but you pay only the one time fee. Your investment summary will remain in the system until such time as you request removal. Each new match that is made will be forwarded to you at no additional cost until you inform us that you have found the investment you are looking for and no longer need your proposal to be posted. Payment must be made through the highly regarded Internet Secure on-line payment system with a major credit card.
• 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. The information you enter into the website 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 Canada 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 $ 3 billion invested annually in Canada and growing all the time, the main obstacle is locating and presenting your idea to this large group of investors. The Canadian Angel 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.

• What makes this service unique? There are a number of services like this in many US markets but very few exist in Canada. The reason why this service is unique is:

  1. We are strictly a Canadian based matching service connecting Canadian entrepreneurs with Canadian angel investors.

  2. Although we do review your investment summaries, the angels determine for themselves what they would like to invest in. Many other services "pre-screen" deals. What is not right for one is not necessarily not right for another

  3. Our fee is only $199 resulting in contact with many potentially serious buyers.

  4. The service operates in "real-time". Like any entrepreneur, you need your investment capital yesterday and the service was developed to satisfy your needs for fast and efficient angel investor prospecting.

• How do I get started? Simply enter the “Entrepreneur” log-in area and complete the basic registration and then press "submit". Your investment summary will be sent out to all of the angel investors in the database that match the specific criteria that they have selected with what you are offering and you will be notified once a match is made. All you have to do is wait for the matches to be emailed to you and then make a decision to proceed. Remember, you pay only once whether one investor or fifty investors are found. It is recommended that you always move forward with as many investors as possible until the best deal is completed. We also encourage entrepreneurs to act as quickly as possible, before the interested investor(s) move on to something else.
• 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 want to use a credit card If you are unable to or uncomfortable with using a credit card, you can pay via cheque when beginning the process of establishing contact with a potential investor if you prefer. We also have a PayPal account if you'd prefer. All that you would need to do is email us to inform us of your intention using the "contact us" page on this website. At that point, we would inform you of what steps need to be taken to complete the transaction with as little hassle as possible.
• How should I protect myself? We advise that Entrepreneurs never pay so-called "upfront" fees for any reason. We also suggest that a non-disclosure agreement should be signed by any potential investors before initiating any negotiations.
• I have other questions. Who do I contact? Contact us by email: info@angelinvestmentnetwork.ca

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