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Set up and all ready to invest

Carefully selective New World Angels help members find prudent investments.

By KRIS HUNDLEY, Times Staff Writer
Published December 25, 2007

Carl W. Treleaven, CEO of Westlake Ventures, poses at home in Madeira Beach. He is forming a chapter of New World Angels in the Tampa Bay area.
	[Scott Keeler | Times]

What better day to report on angels?

A network of wealthy, early-stage investors in South Florida has set up a chapter in the Tampa Bay area. And members, as well as potential investments, are welcome, with several caveats.

Investment candidates have to pass rigorous screening that weeds out more than 90 percent of applicants. And members have to be serious about writing checks totaling at least $30,000 a year. Service providers chasing new business are not welcome.

New World Angels, a structured investment group in Boca Raton, hopes to formalize what has long been an ad hoc process of seed-stage financing among the local monied elite.

"Most angels get the arm put on them by friends or neighbors, then they drop money without any foresight," said Tom Cardy, membership chairman of New World Angels' Tampa Bay chapter. "Sometimes it works, but a lot of times not."

By joining an existing organization, area investors hope to avoid many of the pitfalls of high-risk deals and take advantage of a selection process that has resulted in five investments over the past two and a half years.

Among New World Angels' deals are a software company, a biotech business and a Latin foods wholesaler. None of have yet resulted in a payout.

Cardy, managing director with Hyde Park Capital Partners in Tampa, said the time was right to organize local angels. Leading the effort is Carl Treleaven, who moved to Madeira Beach two years ago after selling his drug packaging company in North Carolina. About 15 people have joined the local chapter. Three-dozen members live in South Florida.

"With the demise of the real estate market, high-net-worth people have realized they need to diversify," said Cardy, a long-time Tampa Bay area resident. "But they also remember they've gotten their clocks cleaned when they tried to be an angel on their own."

Members must be accredited investors for these high-risk deals, with a net worth of more than $1-million and annual income of more than $200,000. In addition to committing to a minimum of three, $10,000 investments a year, members pay $1,000 a year in dues to cover administrative costs. Back-office help is being provided by Enterprise Development Corp. of South Florida and Florida Venture Forum in Tampa.

Proposals for funding are submitted online at New World Angel's Web site (www.newworldangels.com. The strongest pitches are heard monthly, then the group decides whether to proceed with due diligence. A 10-person board makes the final investment decision. The group's investment ranges from $250,000 to $600,000, but in most cases, that investment has triggered additional funding from other wealthy individuals or venture funds.

Treleaven and Cardy expect that will be the case as New World Angels' reputation spreads throughout the Tampa Bay area. They're also hopeful the network will nurture successful local entrepreneurs who will themselves one day become angel investors.

"People here have been focused so much on real estate, everything they build has been around dirt, not intellectual property," Treleaven said. "We're looking to create new industries, products and services. And once they're commercialized, affluence is created, talent starts coming in. It snowballs."

Kris Hundley can be reached at hundley@sptimes.com or (727) 892-2996.

Tight operation

What New World Angels wants in its members:

-Willingness to invest a minimum of $30,000 a year.

-Willingness to share expertise during due diligence of potential investments.

-Contacts and networks that can yield viable investment candidates.

What New World Angels wants in its investments:

-Companies that have a specific market niche, have tapped out friends and family, and preferably have some revenue.

-Companies in information technology, life sciences, renewable energy and consumer products, not real estate or traditional energy.

-A strong, experienced management team.

'Angel' investor?

An angel investor typically is an affluent individual who provides capital for a business startup, usually in exchange for an ownership stake. The term "angel" originally comes from England, where it was used to describe wealthy individuals who provided money for theatrical productions.

Source: Wikipedia

[Last modified December 24, 2007, 17:02:10]