Trade Association Providing Opportunities for Angels.

ENTREPRENEURS may not all believe in heaven, but hundreds descended on the Javits Center last week in hopes of meeting a real angel - early-stage equity investors with an appetite for investment in entrepreneurial companies.

There are at least 500,000 angel investors, and their numbers are growing, according to Scott Peters, co-CEO of the Angel Society, the new trade association that sponsored the Angel Society Forum at Javits. Once disconnected, angels are beginning to network more formally through organizations like the new Society, which created the forum to facilitate introductions between investors, entrepreneurs and other strategic partners.

Peters, a former investment banker, said more than 500 people registered for the seminars, along with about 75 exhibitors. (Visit the Angel Society Web site at www.angelsociety.com for details on upcoming forums in 2001). Last week's forum also coincided with the launch of the group's new bimonthly magazine Angel Advisor, published by Bloomberg Press.

Thirty lucky entrepreneurs were chosen from more than 300 entrants to present their businesses onstage in public sessions called the "Pipeline." Other entrepreneurs displayed their wares and concepts in booths, along with consultants, attorneys and other who serve the small business market.

One energetic entrepreneur, James Wen, president of Funky Monks Syndicate, a new-media startup in New York, was working his way through every booth. His flagship product, Web Scrivener, allows users to write and mark up Web sites.

After Guy Kawasaki, CEO of Garage.com, a company that helps entrepreneurs find financing, delivered his keynote speech, Wen ran up to meet Kawasaki. Wen launched into his pitch, described his business and kept talking. Kawasaki finally stepped back and said with a smile: "That's a long elevator ride. Ding." Still, Kawasaki accepted Wen's business card and gave him one in return.

"Persistence is important," said Wen in an interview. "But they make it challenging with these conferences, especially since this one is three days long. If I get six good leads that I can follow up on, it's pretty good. So far, I've gotten five ... You've got to be realistic. Don't go in thinking you're going to come out with a term sheet."

Entrepreneurs who submitted their executive summaries to be considered for Pipeline presentations were selected by e-BIDTA, a venture banking company that takes its name from the accounting acronym for earnings before taxes, depreciation and amortization.

One of the Pipeline entrepreneurs was Dr. Martin Andrews, who has a Ph.D. from Cambridge University in artificial intelligence. He has already started on a successful business, a high-yield bond-trading site. His new business, Platormedia, a New York City-based software company, has developed a software program that allows idle computers to perform complex computations that require large amounts of power.

"Investors with money have been giving us business cards," said Andrews, happy with the response to his presentation. Andrews says funding his first business (the bond-trading site) was a snap compared to finding funding for his new venture. "We'd go to bond traders, explain the idea, and they'd say 'OK, sounds good,' and write a check. But these were bond traders ... And that was pre-March. (March was when the dot-com crash was full-blown.)

Dr. Pavel EFremkin, CEO of FriendlyLight LLC, was promoting his company, which develops and manufactures portable medical lasers. His booth, placed right by the entrance to the presentation stage, was crowded. Efremkin reported that more than 50 people asked to see his business plan. Not bad for three days' work.

Another entrepreneur, Craig Saunar, co-owner of Terawet, boasted, "We're probably the most exciting story in this building," and dismissed the glut of e-businesses with a wave of the hand. Saunar said he was at the forum to do research, and wasn't worried about finding funding for his line of agricultural enhancement products, which consist mainly of water-absorbing polymers that hold moisture in the soil.

"All I need is a million bucks," said Saunar. "And, I need to hire 50 people."

Alley Capital Partners reps were busy trying to promote their services, which try to match up investors and entrepreneurs. Alley Capital, a New York City-based investment bank with 10 employees, has been in business since March.

"It's always easier to find people looking for money than people who have it," said Alley Capital associate Paulette Bonici.

Garage.com's Kawasaki said his team reads about 12,000 business plans a year. Reviewing thousands of plans is possible only because his company has developed a highly automated process, where all businesses answer the same questions.

"This makes them much easier to compare," said Kawasaki in an interview. "We use the computer to process the plans, but each one gets seen by human eyes."

Kawasaki is considered a luminary in the entrepreneurial community. His experience includes two stints at Apple Computer and the authorship of several popular books for entrepreneurs. Though angel investors typically prefer to keep a low profile, there were plenty of hands raised in the audience when Guy Kawasaki asked how many angels were in attendance.

Lots of entrepreneurs were pleased to be meeting investors, but many reported they also found partnership opportunities with other businesses, a happy side effect of the gathering.

Here are some tips for entrepreneurs raising capital, from Guy Kawasaki's keynote presentation at the Angel Society Forum:

* Create your team first, and then look for the money. The days when investors would fork over cash for a promise are gone. "The way you do it is evangelism," says Kawasaki. "It's also options, quite frankly."

* Don't try to save money in stupid ways (like hiring lawyers without experience in venture funding).

* Don't ask investors to sign a nondisclosure agreement, which Kawasaki says is equivalent to wearing a sign that says, "I am a bozo."

* Keep your pitch brief - a one-page email is ideal.

* Never pretend you have no competition - the existence of enemies validates the market.

* Eat when served, or as Kawasaki puts it, "When people are offering you money, take the money."

* Ask for less money than you need, because you can claim success faster. "When you say you're no longer taking money, that's when you'll get more offers," he advised.

* Avoid doing business with family and romantic partners; it gives investors "one more reason to say no," says Kawasaki.

* Finally, keep burn rates low and cash balances high. You'll need a year or two of capital, because as your business grows, it will change.

Reported by Sarah Prior. Jane Apple gate is the author of "201 Great Ideas for Your Small Business" and is CEO of SBTV.com, a multimedia site providing small businesses resources.