With the Louisiana entrepreneurial ecosystem becoming more robust, startups can now turn to the South Coast Angel Fund for support growing their ventures. The South Coast Angels are a member-managed angel venture capital fund that invests in early stage companies located in the Gulf Coast. The Fund is made up of nearly 40 angel investors with a wide range expertise.
Clayton White is the Director of the South Coast Angel Fund.
Angel investors play a very important role in early round financing, often providing valuable advice and contacts in addition to giving the startup of the capital it needs to jumpstart growth. Statistically, however, only about 3% of companies that apply will get funded. Director of the Fund, Clayton White offered the following advice to help prospective entrepreneurs increase their chances:
- Headquartered within Louisiana or a 3 hour drive of New Orleans
- In a technology sector
- Seeking investment of $1 million or less from South Coast
- Can match at least 50% of requested funding (from principals or other previous/current investors or sweat equity)
- Seeking to close your first round of investment with a professional group
- Have a personal referral from a member of South Coast Angels or another angel group
2. Build a strong management team. This past March, the Fund announced its first investment in Omnicademy particularly because they were impressed with the company’s management capability. White notes, “You need a good idea, but what really sold us on Omnicademy was their management. You can take a really good idea and drive it into the ground. Omni has a really strong management background. That’s really what we bet on.”
3. Understand your immediate financial needs. Keep in mind that South Coast will typically invest between $250,000 – $500,000. As you seek to raise an early round of capital, you should have a detailed plan prepared that illustrates the uses of the funds.
4. Make an impactful pitch. You will be given only 15 minutes (not one second more) to present your company. Having a compelling presentation is a must.
5. Be prepared for due diligence. If South Coast likes your presentation, they will invite you into their due diligence process, asking you to share in depth information about your company. Have your paperwork organized and in place so as not to slow down and deter investment.
Keep in mind that even if you’re turned down from the Fund, you still have an opportunity to improve and reapply. White reassuringly notes: “There has been a couple of companies that we’ve said ‘We’re not ready to come on board, but we think you have great potential. Here are the things you need to work on. When you get some of this solved, you’re automatically invited to come back and present to us.’ And we help them solve them.”