Angel investing for women
We asked Gillian Fleming, Co Founder and Director of Mint Ventures about angel investment and what makes Mint Ventures different.
Q. What is angel investing?
Angel investing is when individuals invest their personal money (capital) in an early-stage company – often known as a start-up – in return for shares or equity in that company.
Interestingly the term "angel" originally comes from the Broadway theatre, where it was used to describe wealthy individuals who provided money for theatrical productions that would otherwise have had to shut down and this terminology was then adopted in the business world.
The UK is the largest and most established European business angel market with angels collectively investing an estimated £1.5 billion per annum. In Scotland, business angels that are members of LINC Scotland (the national association for business angels in Scotland which Mint Ventures are part of) invested £103 million in 87 companies in the past year. And when more informal investing, such as money from friends and family is included, angel investing in Scotland is thought be nearer £300 million per annum. There are 22 angel groups (also called syndicates or networks) in Scotland most of which invest in science and technology businesses however there are many other less supported sectors that go under the radar.
At Mint Ventures we are really keen to support start-ups in industries that have less investment yet are still scalable and are more likely to be led by women or diverse teams. Such as: creative industries, retail, online market place technology, financial and legal tech, Femtech and related medical devices and veterinary / pet care. This is by no means exclusive and we are open to considering any market sector that meets our criteria.
Q. Is it like ‘Dragons Den’
Angel Investing is about supporting entrepreneurs with more than just finance and at Mint Ventures we provide social, human and economic capital also referred to as SHE capital. We focus on providing support with the human part which means having access to our team and the fantastic spectrum of expertise of our members. We also signpost and provide introductions to the wider entrepreneurial network aligning this with each individual company’s needs.
Coaching and mentoring are integral parts of our support as this can make all the difference especially at this early stage where we often see founders overwhelmed with where to start on the funding journey and getting introduction to an angel investors. We provide a safe and comfortable environment for our members to learn how to angel invest and for our entrepreneurs to share their vision in an friendly and open manner.
The principle of Dragon’s Den is there but without the aggression which makes entrepreneurs feel uncomfortable, it’s not all about the performance and pitch, its more about the opportunity and the team, their vision and how they are going to realise it.
Q. What’s different about Mint Ventures compared to other angel syndicates?
We invest in products and services that meet the needs and interests of women and have a social, ethical or environmental purpose. We also have diversity and inclusion running through the veins of the company. Our selection criteria require that there must be at least one woman in the executive management team or on the board. We understand the importance of diversity in driving greater innovation and how women do more with less money and have a different attitude to risk.
Q. Why is there a gender gap in angel investing?
At present most angel syndicates and venture capital firms have mainly male members and male employees. This can lead to unconscious bias in the selection of funding opportunities to invest in, and products and services that meet the needs or interests of women are not always fully understood.
Women hold 60% of the UK’s wealth, yet only 15% of business angel investors in the UK are women.
Mint Ventures are on a mission to change this by creating a network type club that welcomes empowering women and encourages them to learn and make decisions about their money.
Q. How do you get started in angel investing?
Like many people that start angel investing I fell into this through working in the entrepreneurial ecosystem for many years and supporting exciting start-ups to become investment ready propositions and successfully raise finance. It was doing a Saltire Fellowship Leadership Program with Entrepreneurial Scotland that changed my attitude to risk and I thought why shouldn’t I start investing in some of these opportunities myself, so I did. I had the background of working in investment so it was easy for me to self-certify as a sophisticated investor. Then I decided to put some of my savings into start-ups rather than cash or stocks ISA. It was empowering to make my own decisions, knowing the teams and understanding the propositions rather than going with the recommendations of a magazine on FTSE stocks and shares.
To help you decide if angel investing is for you we have made available a free taster course and if you do decide to join us we offer comprehensive training on angel investing which includes the fundamentals of learning how to evaluate a business plan and read a set of accounts. Visit Mint Ventures to find out more.
Although it is high risk, and you should only be prepared to invest what you can afford to lose, it is so much fun working with like-minded women and men that all have the same objective of helping and supporting each other to grow business opportunities.
Q. Do you have to be ‘High new worth’ to be an angel investor?
It is a huge misconception that you need to be rich to be an angel investor and there are a variety of different ways that you can become one. Many angel groups do prefer members to be what is known as a high net worth (HNW) which means having an annual salary of over £100k or certain net assets in addition to your home. However, another route is to join an angel group for 6 months and train with them to self-certify which is what we are offering at Mint Ventures. It’s essentially democratising angel investment by welcoming women to come along, get involved and attend training in a friendly environment where we speak plain English, avoid jargon and women don’t feel that they can’t ask a question that might make them feel inadequate.
To open up the opportunity to invest and get involved, our minimum investment amount is £2k whereas the majority of angel groups would look for a minimum of £5k and more often £10k.
Another lesser well-known revelation about Angel Investing is the tax breaks available. The UK has one of the most advanced tax relief systems in the world to encourage angel investment as a welcomed source of finance for startups. Through the Entrepreneurial Investment Scheme known as EIS and the Seed Entrepreneurial Investment Scheme (SEIS ) individuals can receive 50% tax relief for SEIS and 30% for EIS qualifying companies. This effectively means that you can get up to half your money back if the company you are investing in has been approved for the scheme through simply completing some forms. In addition to that, capital invested in angel investing can also be offset against any Capital Gains Tax giving further tax advantages.
Q. Besides investing money, how else can you be involved?
Our members can get involved as little or as much as fits with their time availability.
Some experienced angels may want sight of additional opportunities to invest in that are of more interest to them and that meet their social, ethical or environmental ethos. Other members really want to get involved in the due diligence process which can be anything from getting to know the team to evaluating commercial strategy or reviewing legal documents.
On average we have an event each month that includes inspirational leadership speakers, practical training and presentations of investment opportunities which is the highlight of my weekday evening once a month. Professional skills are transferable, we encourage our members to use and develop their business skills. There is often too much focus on having specific sector experience in the start up world however, all types of business skills are required which can be applied to any sector including legal, HR, Financial, Sales and Marketing.
If you are a business owner or founder, read more about being investment ready and our process here.