Sharjah 24: How do you convert high-net-worth individuals into angel investors? How do you diversify risks, negotiate deal terms and approach tech startups? How do you secure business investment opportunities that could lives?

These were some of the questions and issues discussed at the recent “Angel Investment 101” session, organised by Sharjah Research, Technology, and Innovation Park (SRTI Park) the umbrella of Sharjah Angel Investors Network (SAIN). Speakers at the panel include Henrik Peter, co-founder at Emerging Markets Angel Network; James Asquith, founder and CEO at Holiday Swap, and Atti Assi, CEO at Amima Ventures.

Speakers discussed how building a diverse portfolio is critical to success as an angel investor. They noted: “Every start-up has a mix of risk categories, including risk on market adoption, technology risk, intellectual property risk, financing, regulatory risk, and more.  Having a diverse portfolio means reducing the risks and exploring new opportunities to support local businesses and entrepreneurship community.”

“Don’t put the eggs in one basket, as the adage goes. By doing this (diversifying), new-time investors minimise risks as they spread their investments across different sectors, industries, and portfolios to have a diversified stream,” they added.

The panellists also noted angel investors cannot put equal weight on every risk at once. “The key is to focus on the major risks first and leave the secondary and tertiary risks to the side to be addressed at the right time.”

Factors to consider
The speakers also advised investors to spot the red flags before investing. Some of the factors to consider are team risk and market risk. In the team risk category, investors should check on the integrity of the founder and start-up team. “If they are being dishonest or misleading about some information or details, it’s time to walk away,” noted one panellist. 

Another factor is to consider the intellectual smarts and EQ or emotional people skills. These include communication skills, leadership potential as well as tenacity and drive of the team. 

More importantly, angel investors can help develop a good dashboard of performance indicators and monitor it regularly. Having the right measures will help the business innovate and evolve.

Supporting start-ups
SRTI Park launched the Sharjah Angel Investors Network (SAIN) early this year to support entrepreneurs and boost innovation and creativity by providing capital in early stages of businesses thus making UAE and regional companies among the best in the world in technology and advanced services.

Hussain Al Mahmoudi, CEO of SRTI Park, said: “SAIN helps in the financing of startups. It also assists angel investors pick up emerging projects that provide revolutionary or unique technological solutions. This is what we are doing at SAIN – to provide investors with companies that have future advantages.”

Al Mahmoudi added SRTI Park is also attracting quality investments. “The partnerships being built are in line with the objectives of the UAE to boost national economy with innovative investments that enhance its position as a destination for world-class business and innovation,”  he concluded.