Archive for June, 2010

Angels in our Midst

June 10, 2010

No, I don’t mean Angels in the spiritual sense, although to a start-up business an Angel investor is so named because their investment is like a gift from above.  To the entrepreneur, an active and engaged Angel community can be among the most important aspects of setting up a business in a particular location. 

With this need in mind, in April Innova further expanded its leadership position in finding, funding and growing early-stage growth companies with the launch of the Mid-South Angel Network (MSAN). Just over a month later, Innova is finding a receptive audience and great opportunity.   

Founded in 2007 by the Memphis Bioworks Foundation, Innova is a pre-seed, seed and early-stage investor focused on starting and funding high-growth companies in the Biosciences, Technology and AgBio fields across the state of Tennessee.  Innova is also, through its Innova Fund II LP, the first Tennessee Small Business Company Investment Credit Act (TNInvestco) organization in West Tennessee.

The Mid-South Angel Network is a unique model that will capitalize on Innova’s TNInvestco designation, while the potential investors capitalize on the ongoing due diligence and research taking place at Innova. The members of the Angel Network will have comfort that these are investments Innova has researched and vetted, and in most cases Innova will be investing along with them.  This allows them to take advantage of Innova’s established investment strategy and portfolio management capabilities, and take advantage of the deep research done by Inn ova staff.   Such a structure also means the Innova investment dollars through TNInvestco are stretched even further by joining them with local Angel dollars.

It is expected that members of the Angel Network each will be required to invest a minimum amount every two years to prevent the group from becoming “a social gathering.” Investors may be invited to sit on the boards of companies they invest in, as appropriate.

The establishment of this kind of an Angel network creates an identifiable benefit to companies who might be considering moving to Memphis or to Memphis-based discoveries and creations that are not sure where their most receptive home might be.  Having local high net worth individuals who directly invest into promising entrepreneurial businesses in return for stock or ownership in the businesses creates ties that go both directions. And, in such an influential business category – the Center for Venture Research estimates that more than 250,000 individual angel investors invested $17.6 billion in 57,225 entrepreneurial ventures in the U.S. in 2009 – creating ties and opportunities is vital. 

If you think this type of organization and initiative isn’t important to the State, consider the fact that the Angel Network was launched at a reception attended by both Commissioner Matt Kisber of the Tennessee Department of Economic and Community Development, and Commissioner Reagan Farr of the Tennessee Department of Revenue. 

At the time of this writing, membership in MSAN continues to grow and, according to Innova leadership, the first potential investment for the Angel Network could come any day now.  If you are in a position to be an Angel Investor, Innova would like to hear from you ( and Memphis applauds you for your investment in our community’s business future.