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-BenWaltonMississippiAngelFundOurmarketherediffersfromotherslikeSiliconValleyinCaliforniawheretheresamorematureknowledgebaseaboutwhatisneededfromallpartiesinvolved.YoumaycontactLynneatlynne.jetergmail.com.OurmarketherediffersfromotherslikeSiliconValleyinCaliforniawheretheresamorematureknowledgebaseaboutwhatisneededfromallpartiesinvolvedhesaidcandidly.Mostentrepreneursarenotverywellversedinareasofwhatinvestorsneedsuchasplanningforgeneralmanagementissuesandpresentations.Theproblemismostinvestorsarenotsetupforhands-oncoaching.Mostdonthavethesizeanddepthtoprovidethatfunction.Otherthanthird-partygroupsorconsultantsthatreceivepaymentorequityinthecompanyforhelpingentrepreneurstheMississippiTechnologyAlliancehasbeenhelpingthemwithsomeofthosedetailssothatbythetimeinvestorsareapproachedtheresaviablebusinessplan.Earlyinthegameitsalsoimportantforstartupstobecorrectlyvaluatedparticularlyifentrepreneursarelookingforequity.ThatsatrickydiscussiontohavebecauseacoupleofthingscangowrongsaidWalton.Iftheentrepreneurvaluesthecompanytoohighandstillmanagestosecureinvestorstheriskisstumblingdowntheroadandneedingmoremoney.ThatthenleadstothequestionisthecompanyviableenoughtosustainfurthersupportIftheanswerisyesthenifthecompanyhasbeenovervaluedinthepastitsdifficultfortheentrepreneurtoprotecthimselforherselfandtheinitialinvestorswhenfundsareneededandnewinvestorsrequirealowervaluation.EvenwithagoodbusinessplantoperusethefundingprocesstakespatienceemphasizedWalton.Ivespentayearandahalfalreadywithonecompanythathasgreatpromisehesaid.Wereveryinterestedinmakinganinvestmentwiththembutitstakenthatlongtoworkthroughsomeissuestogettothispoint.JanFarringtonaninvestorandamemberoftheMississippiTechnologyAllianceBoardofDirectorssaidittypicallytakeswomenalotlongertodecideiftheywanttoinvestmoneybecausetheyputmoreemotionintothedecision-makingprocess.Womenlookatthebusinessproposalfromallanglesshesaid.Forusitsreallyimportanttofullyunderstandtheintegrityofthepeopleinvolved.Thatwillrepresenttheintegrityofthecompany.FarringtonsaidsheandherhusbandLawrenceafellowinvestormakeitahabittogettoknowtheentrepreneursandothersonthemanagementteamofthecompanyseekingfundingsortoflikecourtshipbeforemarriage.Wewanttoknowthehistoryandbackgroundofthosedoingthecreatingshesaid.Dotheyhaveapassiontocreateoristhisjustaone-timeopportunityforthemWeliketoinvestinpeopleandcompaniesthathavethatburningdesiretocontinuecreating.Theyremindmeoftrueartistswhojustcanthelpbutproducetheirart.Itisalifework.BecausetimeisalimitingfactorformanyinvestorstheyrelyonotherslikeWaltonandFarringtontodiscoverpromisingstartups.WeretryingtoprovideavenueforinvestorsinterestedinthesesmallercompaniesbydoingalotofthelegworksaidWalton.TheyinvestwithustheMississippiAngelFundandwetheinvestmentcommitteeoftheFundmakedecisionsonwhattodo.Itsveryimportanttoofferdiversification.Youhaveanumberofpeoplewhocaninvestacoupleofhundredthousanddollarsanduptoevenmoresignificantamountsbutmostwanttospreadthatmoneyacross10ormorecompaniesratherthantwoorthree.Weretryingtofindenoughinvestmentstoofferthatkindofdiversificationtoourinvestorsbecausethenatureofthisbusinessisthatsomegreatopportunitiesjustdontwork.TheAngelNetworkselectioncommitteeselectsthreeorfourcompaniesorentrepreneurstomakeapresentationtomembersattheAngelNetworksquarterlymeetingsinJacksonandTupelo.BeforeeachmeetinginformationonpresentingcompaniesisemailedtoAngelNetworkmembersinpreparationforthe20-minutepresentationsfollowedbyquestion-and-answersessions.InanagewhenproductscanbeobsoletebythetimetheyareintroducedinthemarketplaceitsmostimportantthattheentrepreneursaregroundedinresearchanddevelopmentonacontinuingbasissaidFarrington.IdeallytobalancetheriskoflossoftheinvestmenttheAngelNetworkselectioncommitteeselectsstart-upsthathavethepotentialtoprovidea30-40percentrateofreturnwithinfourtosevenyearsasignificantlyhigherpaybackoveraperiodoftimethantraditionalconservativeinvestments.IfthereturnistherethetimeframeisntquiteasrelevantsaidWalton.Whenthingsaregoingwellpeopledontwanttheirmoneyback.Theywanttoleaveitinthere.Theriskismitigatedatthatpointreturnsarefairlygood.YouknowwhenyougothebanktoborrowmoneywhenyoureallyneeditItsdifficulttoget.Butwhenyoudontneedaloanoffersflowinonaregularbasis.Investinginsmallcompaniesissimilar.Youhavetomakejudgmentcallstospotthehiddengemsearlyon.PointeInnovation20magazine