An angel investor (also known as a business angel, informal investor, angel funder, private investor, or seed investor) is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity (Source: Wikipedia).
Southeast Minnesota Capital Fund (the "Fund") is a Minnesota company formed to establish a pool of investment funds, contributed by individuals for the purpose of providing equity financing primarily in, but not limited to, Rochester and Southeast Minnesota startup companies.
In mid-2015, Journey to Growth’s Entrepreneurial Committee identified the need for local angel financing as one of the main impediments for startup creating and growth. Rochester Area Economic Development Inc. (RAEDI) was then tasked with organizing the Fund. When the RAEDI board approved an initial investment of $50,000 in the Fund, RAEDI became the first investor in the Fund. The Fund currently has 26 investors and $875,000 in funds.
The Fund’s goals are to return a profit to the investors, provide a solution to specific small business financing needs, help create and retain jobs, and provide positive economic impact to Southeast Minnesota area.
The Fund is organized through a limited liability company called Southeast Minnesota Capital Fund LLC. The Fund has 26 members. A subset of the members are also managers and tasked with making investment decisions on behalf of the whole membership. RAEDI administers the Fund using their existing back-office infrastructure.
Yes. The Fund goal is to reach between $1 million and $2 million. The fund is currently open to additional members that are accredited investors, with a minimum total commitment of $25,000. The fund will stop accepting investors as of December 31, 2017. At that point, new members will no longer be accepted into the current Fund. Interested investors may contact the fund at .
No. Investors in the fund must be “accredited investors” as defined by the applicable Federal Securities Laws and Regulations. Briefly, an “accredited investor” has individual income in excess of $200,000 or joint income with the person's spouse in excess of $300,000 or individual net worth or joint net worth with the person's spouse that exceeds $1,000,000.
We are mainly looking for companies with high potential for rapid growth. Applicants must demonstrate a sound business plan and existence of a qualified management team that can execute the plan. There must be a reasonable prospect for a profitable return on the investment.
Companies may contact the fund at .
The maximum investment in a business will be a factor of the final fund size. With a $1 million fund, it is expected that $50,000 will be the average investment amount.