Network Pairing Start-Ups, Investors Launched Tues.
A new resource that launched Tuesday will connect emerging companies with angel investors.
The Minnesota Angel Network (MNAN) is an initiative hosted by the BioBusiness Alliance of Minnesota, and plans for it were announced in January.
According to the Star Tribune, the network plans to enroll at least 30 companies this year. It is specifically geared toward Minnesota-based start-ups that aim to raise $50,000 to $4.5 million, and those selected for the program will be given a team of up to eight advisors who will provide feedback, the Minneapolis newspaper said.
Part of what MNAN will do is prepare entrepreneurs to interact with investors. Once a company in the program hits certain milestones, it will then be able to connect with angel investors through an online portal.
The portal is designed to help early-stage companies take advantage of Minnesota's angel tax credit, which gives a 25 percent tax break to individuals and investment funds that provide as much as $4 million in seed money to start-ups focused on technology.
A total of $11 million in tax credits was available in 2010, and the state will fund $12 million in credits annually between 2011 and 2014-although roughly $4 million from last year was unused and rolled over into this year. All of the roughly $16 million in credits that's available in 2011 is expected to be given out by year's end. Credits cannot exceed $125,000 per person per year.
Todd Leonard, executive director of MNAN, told Twin Cities Business in January that the MNAN site will allow companies to answer a series of questions, which will be used to create a summary of their business plan, in turn making it easy for investors to find companies in which they are interested.
“We're not the group that will deliver a business plan,” Leonard said at the time. “We're helping them prepare for the rigors” of interacting with sophisticated networks of investors.
The network hopes to enroll 10 new start-ups each month and have more than 100 companies enrolled by the end of 2012, according to the Star Tribune. The network will enroll five companies each month for the remainder of this year.
Start-ups enrolled in the program pay a fee based on their revenue, the number of people who need to be trained through it, and the company's educational needs, according to the newspaper.
MNAN will be funded through the educational fee, grants, and donations-and it reportedly aims to be self-sustainable after two years of being up and running.