By guest authors Irina Patterson and Candice Arnold
Irina: Those angels, are they all based in and around Jacksonville?
Alan: Generally so. I say generally because there are some outliers. We’ve got some people from Savannah, we’ve got some people in Tampa and that area, but generally, in the first two funds that we built we’ve been very heavily focused in the northeast Florida area, meaning Jacksonville, Ponte Vedra Beach, Amelia Island, this neck of the woods.
Irina: Anybody from Miami?
Alan: No. We’ve had some people from Miami who’ve expressed an interest. One of the things we’re considering in a follow-on fund is whether we’d like to broaden the reach and the footprint of Springboard.
There is an angel investment organization, not a fund in South Florida, New World Angels. We see them as somewhat of a dance partner, a natural coinvestor, somebody whom we can work with down in that neck of the woods.
Irina: Do you consider yourself a regional fund? If so, what’s your region?
Alan: We’ve invested as far out as Maryland. But generally, we like to stay close to home and that’s probably the typical angel definition of about a two-hour drive. When we go outside of that area, which we do – that’s not an issue to us – we would normally do so as a coinvestor with a lead investor who’s much more geographically proximate to the company. We’re focused on early-stage companies, and geography does play a part. Because things can happen very quickly, and a lot of times you want to be able to get together physically at a very short notice, it’s nice to stay close to investments.
Irina:What are your current sources of deal flow?
Alan: We get deals from all over the place. First of all, there’s a broad category that I think you could call over-the-transom and unsolicited emails. We also get all this stuff that comes through AngelSoft. That’s probably the bulk of the overall deal flow.
Beyond that, though, there are a number of other sources, whether it be incubators, of which there are not many in the state of Florida. But there are a couple, at universities and technology transfer programs.
We get a lot through professional service providers, whether they be attorneys or accountants. We get actually quite a few from our own partners, our own members, who become aware of opportunities. Probably the best source of deal flow is the venture capital industry.
Most venture capital firms, with which we work very closely, tend to be a bit later stage in their focus than we are. Therefore, they may see some opportunities that are early for them but in their professional judgment have some serious promise. Those are some very high-value referrals that we get. And we try – to the extent that we have time – to cultivate those relationships with venture firms in order to be able to see those kinds of companies.
The venture firms, generally speaking, are very professional and normally, they have a tremendous ability to see an early-stage company and know immediately that it has very strong attributes that would make it worth a look but it doesn’t fit their criteria. That’s very helpful to us.
Going back to the first piece, the stuff we get unsolicited, there’s not an awful lot in there. It takes a lot of time to work through those, but very seldom do you find anything in there. This business is such that when you’re in early stages – to use the expression – “there’s a lot of noise on the circuit.”