Regional Angel Investment Network -

THE NEED

Business start-up and expansion is one of the primary keys to economic development at the local level. Most entrepreneurs agree that raising capital is the primary obstacle hindering their growth. The Midwest has been traditionally underserved by the private equity community.  As venture capital funds have increased in size in the past decade, their minimum investment has correspondingly increased to the point where few VC's today consider financings of less than millions of dollars. We believe opportunities too small for most equity firms are available.  In addition, we believe that having a local presence in the Midwest provides us a competitive advantage in sourcing investment opportunities and monitoring portfolio companies.  The goal of the Regional Angel Investment Fund is to fill the gap between "friends and family" and traditional VC financing for companies in the Midwest. Funding and assistance from RAIN will allow a business to accomplish critical milestones that will allow it to grow.

 

THE OPPORTUNITY

The Fund is being organized to provide its investors the opportunity to achieve a combination of current income and the potential for long-term capital appreciation through investments in private companies that have the opportunity for growth.  We expect to build a diversified portfolio of investments in private companies operating primarily in the Midwest United States.  These portfolio companies typically will have revenue of less than $10 million at the time of our initial investment.

We believe that an opportunity exists to generate significant investment returns by investing in private companies in the Midwestern United States.  The Midwest is experiencing downsizing in its underperforming manufacturing base, due in part to foreign competition.  Notwithstanding, opportunities exist for certain types of manufacturing. Additionally, we believe that certain opportunities exist in the Technology and Distribution markets.

While we plan to invest a majority of the Fund's capital in companies located in the Midwest, we also intend to leverage our network of business relationships, and we may review opportunities with attractive prospects outside of the Midwest.

We believe that developing a strong, positive working relationship with the management teams of portfolio companies is critical to mitigating risk, increasing influence and improving the overall governance of the portfolio company.  As a result, we will seek investments in companies with management teams open to our active involvement. Finally, we will attempt to create a balanced portfolio of investments by industry and by stage of development to reduce overall portfolio risk and increase the opportunity of having strong performing businesses in attractive market segments.

 

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