Q. What does the $600 buy? Is it one time or annual?
A: Membership in Show Me Angels is a $600 annual fee. Many Angel groups charge $2500 to $5000 per year, therefore Show Me Angels is a great value. Fees go to the local network to offset operating and meeting costs and to reimburse members for training to increase our skills and understanding of angel investing.
Q. There are other angel investor groups in the Kansas City metro. Isn’t Show Me Angels a redundancy?
A: Show Me Angels is the only angel investor network that will focus on Western Missouri and Eastern Jackson County. There are a lot of seasoned investors and entrepreneurs on the Missouri side of the metro area who do not find it emotionally acceptable to make investments across the state line. Show Me Angels gives these investors an outlet to invest locally. Business start ups are an integral component of a well-balanced economic development program. Because Show Me Angels is a joint effort and regional collaboration among the economic development organizations in Eastern Jackson County (Lee’s Summit, Blue Springs, Independence, Grandview, Grain Valley and Oak Grove) these local investments will support the sub-regional economy in Eastern Jackson County. Show Me Angels also plans to be influential at the Missouri State Government level. Show Me Angels will be proactive in helping improve the Missouri business climate for entrepreneurs and angel investors throughout the entire state.
Q. If the governance structure is “non-profit”, how can we make a profit?
A: In general terms, “non-profit” has a connotation of a 501(c)(3) organization that can accept charitable donations. Show Me Angels is not a 501(c)(3). The basic structure of Show Me Angels is an association of members to share expenses. However, the objective of Show Me Angels is to gain a high return on investment, ultimately making a profit. Each deal that investors participate in will be set up as a separate for-profit entity, allowing the angels to turn a profit on their investment.
Q. How often will the members meet?
A: Show Me Angels will meet monthly or bi-monthly, depending on the deal flow. The technical committee that screens the investment opportunities will meet monthly.
Q. Where will the meetings be held?
A: The technical reviews to determine the worth of a deal will take place at the office or home of a member of the technical committee. If the deal passes, the meetings will be held at rotating locations around Eastern Jackson County that are convenient for everyone involved. This may include member company offices, economic development offices, neutral locations and investors’ homes.
Q. Can I bring guests to the screening session?
A: Once an entrepreneur applies for funding, the technical committee will review merit and worth of the deal. The technical committee is a closed door meeting. During the screening session when the entrepreneur presents to the Show Me Angels’ membership and representatives from local economic development organizations, guests may be invited only if they are qualified investors as defined by Rule 501 of SEC Regulation D and potentially intend to join Show Me Angels in the future.
Q. Is Show Me Angels membership public or anonymous?
A: Membership is anonymous. We understand that high-net worth individuals prefer to be behind the scenes, therefore Show Me Angels will protect and respect each of its members’ privacy.
Q. As an angel investor, what are the typical type of ownership options or stake in the business we are investing in?
A: The angel investors’ stake in the company will vary by each individual deal. A popular compensation is preferred stock option. Some deals may give the angels a board position in the company. All investment decisions, and level of involvement in a company are up to the individual investors who participate in the deal.
Q. Is the deal reviewed before or after review from a banker?
A: Deals will typically be presented to Show Me Angels through its Web site after being reviewed by a banker. Entrepreneurs typically tap into angel investment groups after receiving initial funding, so bankers are involved earlier in the process.
Q. I am already busy. How much time will this take up? Will I be inundated with emails and meetings?
A: Each individual investor can decide how much or how little he or she wants to be involved. Through the Show Me Angels Web site, investors can set email and communication preference. You can choose to simply receive an email when a deal is available to review — and indicate whether or not you want to be included in that deal with a simple click of the mouse.
Q. I am already a member of Mid America Angels. Can I have access to Show Me Angels deals?
A: As a member of MAA, to access Show Me Angels deals you will simply need to pay an additional $450 to cover the administrative and operational fees to participate in any deal not offered by Mid America Angels. Mid America Angels, the Women's Capital Connection and Show Me Angels often work together to increase exposure and funding for presenting entrepreneurs.
Q. I am not a resident of Eastern Jackson County. Can I still join Show Me Angels?
A: Yes, angel investors interested in joining Show Me Angels is open to individuals outside of Jackson County, however our focus for investment opportunities will be on entrepreneurs and businesses in Eastern Jackson County.
Q. Is membership open only to individuals, or can a business become a member of Show Me Angels?
A: Angel investing is strictly controlled by the SEC rules for accredited investors, Rule 501 of Regulation D. Therefore Show Me Angels will adhere to their regulations and criteria. The $600 membership fee is for an individual angel, however there may be opportunities for companies to invest in deals. Prospective members should consult their attorney to verify compliance with the SEC accredited investor status.
Q. How quickly will I see a return on my investment?
A: Angel investing is risky, which is why the rate of return is high. Investments by angels are long-term, typically taking 3 to 5 years on average to realize a return on investment.
Q. Who are angel investors?
A: Angel investors are high net-worth individuals who invest in early stage companies. Angel investors provide cash to young companies in exchange for equity (typically in the form of preferred stock). Many angel investors are members of angel groups like Show Me Angels. These networks allow the angels to increase their access to investment opportunities and diversify their investment portfolio.
Q. What is Show Me Angels?
A: Show Me Angels is a regional network of accredited angel investors dedicated to identifying and funding the most promising start-up business opportunities in the Kansas-Missouri region. Show Me Angels has two primary objectives: 1) To present high return on investment funding opportunities to its members; 2) To facilitate access to early-stage financing for high-potential businesses and entrepreneurs.
Q. What are Show Me Angel’s investment criteria?
A: Show Me Angels uses the following criteria in selecting companies to present to the network:
• Early stage companies that offer exceptional opportunities for high returns on investment.
• A business opportunity with the potential for rapid, scalable growth within a reasonable time frame.
• A compelling, well articulated strategy for capturing and defending a significant market share.
• Proprietary technology, early market lead, or other strong barriers to entry.
• A strong management team to execute the business plan – with relevant and successful experience.
• A credible exit strategy for investors.
• A team with a desire for mentoring and coaching.
• Location within a 150-mile radius of Kansas City.
• A reasonable valuation that fits within the risk/reward expectations of our members.
Q. Will Show Me Angels sign a non-disclosure agreement or a confidentiality agreement or pay a finder’s fee?
A: Neither Show Me Angels nor its members sign non-disclosure or confidentiality agreements for initial proposals. Also, neither Show Me Angels nor its members pay finder’s fees of any kind to any person or entity in any way connected with investments made by its members.
Q. What happens after I submit my application?
A: Once a proposal is received by Show Me Angels, it will be reviewed by a pre-screening team. Based on the team’s review of the opportunity, they may: 1) ask for a meeting in order to gather additional information about the company; 2) recommend that the entrepreneur present at a Screening Committee meeting; 3) determine the company is unlikely to receive Show Me Angels funding. Regardless of the outcome, the application and Executive Summary will be posted to the member’s area of the website and will be accessible to all Show Me Angels members for review for 90 days. If a member indicates an interest in the opportunity, the entrepreneur will be contacted so that a meeting may be scheduled with the prospective investor.
Q. What occurs after the pre-screening process?
A: Screening: The next step after pre-screening is the Screening Committee. At the screening stage of the process, entrepreneurs will be asked to make a 10-15 minute presentation regarding their opportunity to the Screening Committee. This will be followed by a 10-15 minute question and answer period. Following the screening meeting, entrepreneurs will receive prompt feedback from the screening committee, regarding their decision. Once an investment opportunity is approved by the Screening Committee, a due diligence team is formed and the company will enter into due diligence with Show Me Angels.
Q. What happens during due diligence?
A: Due Diligence: During the due diligence review process, interested investors will analyze the company in great detail. Entrepreneurs will be provided with a list of information they will need to make available for review. Entrepreneurs will also need to make members of their management team available for discussions. Additionally, entrepreneurs will be expected to pay any legal fees associated with the review. These fees will be discussed with the entrepreneur in detail before the due diligence process begins. Strategic and Business Plan Revision: One possible outcome of due diligence is that the entrepreneur will be asked to consider some plan adjustments prior to investment. These might include reshaping the strategic plan, refining the product offering, expanding the management team, focusing the sales effort, etc. The due diligence team will report its findings to Show Me Angels members along with a recommendation. If the recommendation is to proceed with n investment in the company, a term sheet will then be negotiated with the entrepreneur.
Q. How is the term sheet negotiated and how are investments made?
A: Term Sheet Negotiation: Once Show Me Angels members have identified the amounts they wish to invest in an opportunity, a Show Me Angels member will negotiate the term sheet with the entrepreneur. Show Me Angels members’ terms of investment follow “standard” terms for financings developed over the years by venture capitalists and other sophisticated investors. These terms explain what is contemplated and what is prohibited. Investment and Closing: Each interested member of Show Me Angels makes an individual investment decision. Then, Show Me Angels aggregates the funds and typically invests in a company as a single entity (Limited Liability Company or similar). As part of the investment process, Show Me Angels may require 1-2 board seats, and/or observation board seats.
Q. Does Show Me Angels continue to work with a company once an investment is made?
A: Post-Investment: Following investment, Show Me Angels members will be available to assist the entrepreneur in a number of ways. Show Me Angels members can help identify and assess management candidates and board members. They can help craft the company’s financial strategy in raising follow-on capital, and assist with customer acquisition and alliance building. They can also assist with issues involving organizational structure, sales, marketing, and distribution strategies, and other challenges entrepreneurs face in building a strong company. In addition to Show Me Angels members, the angel group has relationships with other organizations and incubators that are available to further assist entrepreneurs, and those support services would be made available to the early-stage company as well.
Q. Does Show Me Angels invest outside of Kansas and Missouri?
A: Show Me Angels prefers to invest in companies within a 150-mile radius of Kansas City. Show Me Angels will typically only consider investment in a company beyond that geographic area for exceptional opportunities.
A: Membership in Show Me Angels is a $600 annual fee. Many Angel groups charge $2500 to $5000 per year, therefore Show Me Angels is a great value. Fees go to the local network to offset operating and meeting costs and to reimburse members for training to increase our skills and understanding of angel investing.
Q. There are other angel investor groups in the Kansas City metro. Isn’t Show Me Angels a redundancy?
A: Show Me Angels is the only angel investor network that will focus on Western Missouri and Eastern Jackson County. There are a lot of seasoned investors and entrepreneurs on the Missouri side of the metro area who do not find it emotionally acceptable to make investments across the state line. Show Me Angels gives these investors an outlet to invest locally. Business start ups are an integral component of a well-balanced economic development program. Because Show Me Angels is a joint effort and regional collaboration among the economic development organizations in Eastern Jackson County (Lee’s Summit, Blue Springs, Independence, Grandview, Grain Valley and Oak Grove) these local investments will support the sub-regional economy in Eastern Jackson County. Show Me Angels also plans to be influential at the Missouri State Government level. Show Me Angels will be proactive in helping improve the Missouri business climate for entrepreneurs and angel investors throughout the entire state.
Q. If the governance structure is “non-profit”, how can we make a profit?
A: In general terms, “non-profit” has a connotation of a 501(c)(3) organization that can accept charitable donations. Show Me Angels is not a 501(c)(3). The basic structure of Show Me Angels is an association of members to share expenses. However, the objective of Show Me Angels is to gain a high return on investment, ultimately making a profit. Each deal that investors participate in will be set up as a separate for-profit entity, allowing the angels to turn a profit on their investment.
Q. How often will the members meet?
A: Show Me Angels will meet monthly or bi-monthly, depending on the deal flow. The technical committee that screens the investment opportunities will meet monthly.
Q. Where will the meetings be held?
A: The technical reviews to determine the worth of a deal will take place at the office or home of a member of the technical committee. If the deal passes, the meetings will be held at rotating locations around Eastern Jackson County that are convenient for everyone involved. This may include member company offices, economic development offices, neutral locations and investors’ homes.
Q. Can I bring guests to the screening session?
A: Once an entrepreneur applies for funding, the technical committee will review merit and worth of the deal. The technical committee is a closed door meeting. During the screening session when the entrepreneur presents to the Show Me Angels’ membership and representatives from local economic development organizations, guests may be invited only if they are qualified investors as defined by Rule 501 of SEC Regulation D and potentially intend to join Show Me Angels in the future.
Q. Is Show Me Angels membership public or anonymous?
A: Membership is anonymous. We understand that high-net worth individuals prefer to be behind the scenes, therefore Show Me Angels will protect and respect each of its members’ privacy.
Q. As an angel investor, what are the typical type of ownership options or stake in the business we are investing in?
A: The angel investors’ stake in the company will vary by each individual deal. A popular compensation is preferred stock option. Some deals may give the angels a board position in the company. All investment decisions, and level of involvement in a company are up to the individual investors who participate in the deal.
Q. Is the deal reviewed before or after review from a banker?
A: Deals will typically be presented to Show Me Angels through its Web site after being reviewed by a banker. Entrepreneurs typically tap into angel investment groups after receiving initial funding, so bankers are involved earlier in the process.
Q. I am already busy. How much time will this take up? Will I be inundated with emails and meetings?
A: Each individual investor can decide how much or how little he or she wants to be involved. Through the Show Me Angels Web site, investors can set email and communication preference. You can choose to simply receive an email when a deal is available to review — and indicate whether or not you want to be included in that deal with a simple click of the mouse.
Q. I am already a member of Mid America Angels. Can I have access to Show Me Angels deals?
A: As a member of MAA, to access Show Me Angels deals you will simply need to pay an additional $450 to cover the administrative and operational fees to participate in any deal not offered by Mid America Angels. Mid America Angels, the Women's Capital Connection and Show Me Angels often work together to increase exposure and funding for presenting entrepreneurs.
Q. I am not a resident of Eastern Jackson County. Can I still join Show Me Angels?
A: Yes, angel investors interested in joining Show Me Angels is open to individuals outside of Jackson County, however our focus for investment opportunities will be on entrepreneurs and businesses in Eastern Jackson County.
Q. Is membership open only to individuals, or can a business become a member of Show Me Angels?
A: Angel investing is strictly controlled by the SEC rules for accredited investors, Rule 501 of Regulation D. Therefore Show Me Angels will adhere to their regulations and criteria. The $600 membership fee is for an individual angel, however there may be opportunities for companies to invest in deals. Prospective members should consult their attorney to verify compliance with the SEC accredited investor status.
Q. How quickly will I see a return on my investment?
A: Angel investing is risky, which is why the rate of return is high. Investments by angels are long-term, typically taking 3 to 5 years on average to realize a return on investment.
Q. Who are angel investors?
A: Angel investors are high net-worth individuals who invest in early stage companies. Angel investors provide cash to young companies in exchange for equity (typically in the form of preferred stock). Many angel investors are members of angel groups like Show Me Angels. These networks allow the angels to increase their access to investment opportunities and diversify their investment portfolio.
Q. What is Show Me Angels?
A: Show Me Angels is a regional network of accredited angel investors dedicated to identifying and funding the most promising start-up business opportunities in the Kansas-Missouri region. Show Me Angels has two primary objectives: 1) To present high return on investment funding opportunities to its members; 2) To facilitate access to early-stage financing for high-potential businesses and entrepreneurs.
Q. What are Show Me Angel’s investment criteria?
A: Show Me Angels uses the following criteria in selecting companies to present to the network:
• Early stage companies that offer exceptional opportunities for high returns on investment.
• A business opportunity with the potential for rapid, scalable growth within a reasonable time frame.
• A compelling, well articulated strategy for capturing and defending a significant market share.
• Proprietary technology, early market lead, or other strong barriers to entry.
• A strong management team to execute the business plan – with relevant and successful experience.
• A credible exit strategy for investors.
• A team with a desire for mentoring and coaching.
• Location within a 150-mile radius of Kansas City.
• A reasonable valuation that fits within the risk/reward expectations of our members.
Q. Will Show Me Angels sign a non-disclosure agreement or a confidentiality agreement or pay a finder’s fee?
A: Neither Show Me Angels nor its members sign non-disclosure or confidentiality agreements for initial proposals. Also, neither Show Me Angels nor its members pay finder’s fees of any kind to any person or entity in any way connected with investments made by its members.
Q. What happens after I submit my application?
A: Once a proposal is received by Show Me Angels, it will be reviewed by a pre-screening team. Based on the team’s review of the opportunity, they may: 1) ask for a meeting in order to gather additional information about the company; 2) recommend that the entrepreneur present at a Screening Committee meeting; 3) determine the company is unlikely to receive Show Me Angels funding. Regardless of the outcome, the application and Executive Summary will be posted to the member’s area of the website and will be accessible to all Show Me Angels members for review for 90 days. If a member indicates an interest in the opportunity, the entrepreneur will be contacted so that a meeting may be scheduled with the prospective investor.
Q. What occurs after the pre-screening process?
A: Screening: The next step after pre-screening is the Screening Committee. At the screening stage of the process, entrepreneurs will be asked to make a 10-15 minute presentation regarding their opportunity to the Screening Committee. This will be followed by a 10-15 minute question and answer period. Following the screening meeting, entrepreneurs will receive prompt feedback from the screening committee, regarding their decision. Once an investment opportunity is approved by the Screening Committee, a due diligence team is formed and the company will enter into due diligence with Show Me Angels.
Q. What happens during due diligence?
A: Due Diligence: During the due diligence review process, interested investors will analyze the company in great detail. Entrepreneurs will be provided with a list of information they will need to make available for review. Entrepreneurs will also need to make members of their management team available for discussions. Additionally, entrepreneurs will be expected to pay any legal fees associated with the review. These fees will be discussed with the entrepreneur in detail before the due diligence process begins. Strategic and Business Plan Revision: One possible outcome of due diligence is that the entrepreneur will be asked to consider some plan adjustments prior to investment. These might include reshaping the strategic plan, refining the product offering, expanding the management team, focusing the sales effort, etc. The due diligence team will report its findings to Show Me Angels members along with a recommendation. If the recommendation is to proceed with n investment in the company, a term sheet will then be negotiated with the entrepreneur.
Q. How is the term sheet negotiated and how are investments made?
A: Term Sheet Negotiation: Once Show Me Angels members have identified the amounts they wish to invest in an opportunity, a Show Me Angels member will negotiate the term sheet with the entrepreneur. Show Me Angels members’ terms of investment follow “standard” terms for financings developed over the years by venture capitalists and other sophisticated investors. These terms explain what is contemplated and what is prohibited. Investment and Closing: Each interested member of Show Me Angels makes an individual investment decision. Then, Show Me Angels aggregates the funds and typically invests in a company as a single entity (Limited Liability Company or similar). As part of the investment process, Show Me Angels may require 1-2 board seats, and/or observation board seats.
Q. Does Show Me Angels continue to work with a company once an investment is made?
A: Post-Investment: Following investment, Show Me Angels members will be available to assist the entrepreneur in a number of ways. Show Me Angels members can help identify and assess management candidates and board members. They can help craft the company’s financial strategy in raising follow-on capital, and assist with customer acquisition and alliance building. They can also assist with issues involving organizational structure, sales, marketing, and distribution strategies, and other challenges entrepreneurs face in building a strong company. In addition to Show Me Angels members, the angel group has relationships with other organizations and incubators that are available to further assist entrepreneurs, and those support services would be made available to the early-stage company as well.
Q. Does Show Me Angels invest outside of Kansas and Missouri?
A: Show Me Angels prefers to invest in companies within a 150-mile radius of Kansas City. Show Me Angels will typically only consider investment in a company beyond that geographic area for exceptional opportunities.