Eric Dobson has a big vision for the Angel Capital Group (ACG), and a recently announced deal in Kentucky significantly advances the goals of the organization’s Chief Executive Officer.
“I want us to be the clearinghouse for angel deals in America’s heartland east of the Mississippi River,” he explains. To further fuel that aspiration, Dobson has announced that Sheltowee Business Network (SBN) has merged with ACG to create the Sheltowee Angel Network. The first meet-up of the new group was last Wednesday night, and the Louisville-based SAN chapter will start making investments in the second quarter of this year.
The merger is the latest in several changes over the past year or so that position ACG to achieve Dobson’s big vision. This most recent announcement brings to ACG a base closer to opportunities and investors in states like Illinois, Indiana, Michigan, Ohio, and Kentucky.
As Dobson noted in a recent interview, another move was the creation of the Appalachian Investors Alliance (AIA) about a year ago as a separate, not-for-profit organization, a structure that allows it to secure grants that are not available to a for-profit entity like ACG.
“We frequently coinvest in deals, but ACG and AIA have separate and distinct operations and missions,” Dobson explained.
Simply stated, the former invests the funds of its angels in promising start-ups after conducting the appropriate due diligence. The latter, on the other hand, is taking a more holistic and longer-term view, helping entrepreneurs ensure they are prepared for investment that could then come from one or both of the organizations as well as others.
“On the AIA side, we have a lot of latitude that we don’t have within ACG,” Dobson said, adding, “Helping entrepreneurs in the way AIA can is a philanthropic or subsidized effort.”
That latitude, coupled with federal and other funding available to a not-for-profit organization like AIA, help seed the pipeline, particularly in more rural areas that have a real void in terms of investment capital. Finding entrepreneurs, linking them to resources, helping them create viable companies, preparing them for pitches to investors, and creating micro funds in regions are among the areas where AIA is focused.
To quote Jim Hart, the Executive Director of the AIA, “Who better to advise the entrepreneurs (on preparation for pitching) than those (AIA) who advise the investors on where to invest,” Dobson says.
Since its creation, AIA has invested $7 million thus far in about 25 companies. Those dollars have leveraged slightly more than $80 million in additional capital that came from sources other than ACG or AIA, and in large part, outside the Appalachian region.