FIRMS, `ANGELS' MEET ON NET.Byline: Deborah Adamson Daily News Staff Writer There's gold to be mined along the information superhighway (1) A generic name for the Internet. (2) A proposed high-speed communications system that was touted by the Clinton/Gore administration to enhance education in America in the 21st century. Its purpose was to help all citizens regardless of their income level. . The U.S. Small Business Administration has launched a listing service on the Internet linking capital-hungry small businesses with wealthy investors. The idea is to let smaller businesses too tiny to attract the attention of venture capitalists Venture Capitalist An investor who provides capital to either start-up ventures or support small companies who wish to expand but do not have access to public funding. Notes: Venture capitalists usually expect higher returns for the additional risks taken. get access to investments by ``angels.'' Angel investors An individual who invests his or her own money in a private company, which is typically a startup. An angel investor is not an employee or member of a bank, venture capital firm or other financial institution that normally makes such investments. are wealthy individuals - who made at least $200,000 annually in the last two years or have a net worth of $1 million - looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. investment opportunities. Called Angel Capital Electronic Network, or ACE-Net, the service is the first federal effort to link companies and angel investors nationwide. ``The purpose is to provide capital to small businesses who are not yet ready to go public or to a venture capital firm,'' said Jere Glover, chief counsel for the SBA's advocacy department. The amount of capital usually provided is estimated to be between $250,000 to $5 million - too big to be raised from the bank, the SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government and among family and friends, but too small for venture capitalists. ``There's a tremendous need for equity capital in growing small businesses,'' said John Rooney
Each year, about 250,000 angels invest $20 billion in more than 30,000 small firms, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the SBA. But the need is much greater: About 350,000 companies need $60 billion of angel investor financing every year. Businesses and individuals need to register with the listing service first. The fee is around $250 for angels and $250 to $1,000 for companies. But the SBA will not be policing the service. Investors should still exercise ``due diligence'' in examining their potential investment. ``When you're investing in smaller companies, you have to evaluate each deal very, very carefully,'' Rooney said. While there's greater risk involved, ``if they do it right, they can get a great return.'' For more details, go to http://sbaonline.sba.gov or http://ace-net.unh.edu. |
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