LH WS

LH
WS2013-14
2014-15RAM
RAM
original Business Scenarios by R.A.Meek
University level ESL

Angel Investments
Angel investors are individuals who invest in businesses looking for a higher
return than they would see from more traditional investments. Many are
successful entrepreneurs who want to help other entrepreneurs get their
business off the ground. Usually they are the bridge from the self-funded
stage of the business to the point that the business needs the level of
funding that a venture capitalist would offer. Funding estimates vary, but
usually range from $150,000 to $1.5 million.
The term "angel" comes from the practice in the early 1900's of wealthy businessmen investing in Broadway
productions. Today "angels" typically offer expertise, experience and contacts in addition to money. Less is
known about angel investing than venture capital because of the individuality and privacy of the investments,
but the Small Business Administration estimates that there are at least 250,000 angels active in the country,
funding about 30,000 small companies a year. The total investment from angels has been estimated at
anywhere from $20 billion to $50 billion as compared to the $3 to $5 billion per year that the formal venture
capital community invests. In fact, the potential pool of angel investors is substantially larger. There are about
two million people in the United States with the discretionary net worth to make angel investments.

The Brain and Spine Foundation is a not-for-profit charity which aims to

maximize the quality of life for people with neurological disorders and to
reduce neurological disability by providing an international focus for
research, education and information. Founded in 2002.Their headquarters is
in Lyons, France with offices in Hong Kong, New Delhi, Johannesburg, Mexico
City, and Chad.
Needs 2.3 million for new building in Lyons and hiring 10 new staff for 2015-16
2014-15
PROS: Strong management, young, well educated and highly motivated staff, lots of support
in communities it serves, linked to UN, Doctors without Borders, and EU funding sources.
CONS: Fiscal management not as strong as it should be. Staff needs more training in PR and
working with media in general. Have made some serious and costly mistakes in purchasing
equipment.
Direct Relief listed in Forbes Magazine as one of 200 best run
agencies in 2009. Founded in 1948. Headquarters in Brussels.
Provides diverse health and welfare services. Working in over
45 countries.
2015-16 (93% funding goals
Budget is 112 million for 2014-15.
2014 It is a for profit agency.
reached as of 1 September 2013).

PROS: Stellar reputation, excellent fiscal management, multiple funding sources, wellconnected with government agencies.

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CONS: Some complaints it has lost contact with grassroots organizations, too much red tape
and micromanaging of country teams, problems with staff morale, high staff turnover.

Angel Investments Meeting Scenario:

You are members of the board of Angel Investments, a small group of international
investors who also seek worthy causes to support around the globe.
Although you are philanthropists, you are also extremely careful where you make
investments/donations and you expect all the organizations you support to be well
managed and have a solid/good reputation in their fields. From time to time you
volunteer your services and expertise as consultants to non-profits (especially newly
formed ones/start-ups) who show promise and appear eager to learn.
You are meeting to consider the two foundations shown above. Discuss their pros and
cons/ strengths and weaknesses. You have 4.5 million (10% of your profits from your
2012-13 investment portfolio) to donate and/or invest in charitable agencies for
2015-16 .
2014-15.
You must decide:

Whether/If to invest
How much to invest (You do not have to invest all of it.)
Under what conditions you will invest (what the foundations have to do to get the
funds)

Board President Professor

Patrik Eichschmied

Board Members:

(put name of student/person here)

1. Prepare and distribute

agenda NLT (Not Later
Than) Tuesday noon.
2. Run/moderate the
meeting.

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