What do Angels look for?

When considering an investment, Angels look at the…

Sector

We prefer to invest in what we know and understand.

Therefore, Spark Angel investors typically gravitate to companies in sectors that mirror our area of expertise including but not limited to Information technology, energy, automotive, telecommunications, internet, enterprise software, SaaS applications and other innovative firms that are market ready and have high growth potential.

Growth Stage

When we invest in early stage companies they are often already generating revenue with products that are completed or at least are post first implementation development.

Preference will be given to companies that have demonstrated that founder/friends/family capital has been extensively deployed to bring the product or service to, or very nearly to, its first revenue customers. The company has not likely undertaken a capital raise beyond this insider group.

Most of our investments will be in the $250k – $400k range, but through our co-investment/syndication relationships with the other angel groups in Ontario we can, through 1 process and 1 term sheet, bring together other angel groups that allow for pooled investments of up to $2 million in any particular company.

Management Team

The management team is an important component in the due diligence process. The Angels prefer to seek (but do not necessarily require) management teams who have a proven and well regarded track record.

Ideally, we look for a management team that has managed a business within the industry that the company operates in, and is complete across the range of management disciplines and business functions required to enable the business’s success – but realistically, this is rarely the case.

There should be a well-developed ‘how to’ plan (not a stuffy, formal business plan) including realistic market penetration and financial projections which articulate the cash requirements through to a cash-flow positive stage in the business. The plan should clearly articulate the scope of the company’s competition and the company’s/product’s sustainable competitive advantage.

Intellectual Property

Proprietary technologies, where applicable, would ideally be protected (or at least be capable of being protected) and the company should have a commitment to continuing this pursuit. In the absence of this, the company should have a well defined rationale for not doing so.

Valuation and Exit

Founders should have a reasonable basis for valuation and a sense of the range of possibilities as to how much of the business they wish to share with new investors.

The Angels will seek a strategic and articulated exit strategy for founders and new investors.

Practicality

We look for companies with a main office or base of operations preferably located within driving range.

Spark has brought together an elite group of experienced business people from all areas of business with the skills and the inclination to support a place for innovation and ideas.

Robert Killin
CEO, SmartDesk

A colleague invited me to a meeting and then I attended a couple of more meetings to get an idea of how the meetings ran and what the organization was all about. It peeked my interest and I liked the fact that there was this forum that was willing to help out new and up and coming entrepreneurs from both a financial and an experience aspect.

Clyde Catton
Tax Partner, BDO Canada

Spark Angels uniquely provides companies across the Durham Region with private equity funding or mentoring, to help scale their business. Executive Director, Malcolm MacTaggart, has a special vision ‘to change Durham’s economy from metal bashing to knowledge-based’. The Spark Angel Network is doing a great job at helping to create jobs in the Durham Region, and building Durham’s economy.

MP Mark Holland
City of Ajax

The Spark Angel network gives students the opportunity to experience first-hand the world of Angel Investing. Executive Director, Malcolm MacTaggart is passionate about giving students in the Durham Region the opportunity to gain workplace-based learning, which we value here at Trent University Durham GTA.

Hailey Wright
Manager, Community Relations and Articulation, Trent University Durham GTA

We found the entire process professional, well-organized and efficient and we received not only investment, but valuable business advice from our Angel.

Raymond Luk
Founder and CEO of Hockeystick.co Inc.

The Spark Angels group has made a difference in our community in many ways. They have brought together a local like-minded business people who care about the community, business, and the growth of the economy. This has, in turn, created friendships. And opportunities for fellow entrepreneurs.

Stephen Barry
Fairall Properties Ltd.

Our Strategic Partners

News & Updates

Spark Angel Network Was Ranked First Overall in Young Groups by Number of Investments Grants for Non-Profit Organizations-Google Ad Grants New Angel Investee Program Available