Cruising for capital leads to cyberspace funding, advice
Jacksonville Business Journal - by Dee Power
Entrepreneurs seeking capital can get tangled up in the World Wide Web.
Go to a search engine, put in the key words, "venture capital," or "private investors," and there are hundreds of thousands of matches.
Assistance for entrepreneurs looking for that illusive investor on the Internet comes in several varieties: capital networks, also called angel networks, publications and intermediary services. But where do you start?
Capital Networks
Capital Networks match investors with entrepreneurs based on completed questionnaires from both the investor and the entrepreneur.
If a match is made, the investor is provided with the entrepreneur's company description or executive summary in-the-blind or without the entrepreneur's name.
If the investor wants to proceed, he is given the entrepreneur's name and contact information and the entrepreneur is given the investor's name and contact information.
• ACE-Net, Angel Capital Electronic Network is sponsored by the U.S. Small Business Administration.
ACE-Net comprises a number of regional networks, which match based on their local investor database, not a national database.
The entrepreneur completes the forms necessary for a Service Corps of Retired Executives offering (in questionnaire format) and then are matched based on their answers. Intermediaries can participate.
Fees are $450 for six months for the entrepreneur and $950 for a year for the investor.
• America's Business Funding Directory, http://www.businessfinance.com.
Business Finance is a matching service like ACE-Net, but is only available on-line.
The matching has to be done each time on-line by the entrepreneur.
The entrepreneur then gets a list of "matched" financing sources and investors to contact. No fee is charged to the entrepreneur. However, only members of the directory will show up as a match. Fees range from $299 to $1,499 for the investor, venture capital company or intermediary to become a member.
If a venture capital company, for example, is not a member, that venture capital company will not be on the matched list of sources given to the entrepreneurs.
• The Capital Network, http://www.thecapitalnetwork.com.
Fees are $450 for six months for both entrepreneur and the investor. It is in Austin, Texas, and is non-profit. This is an example of one of the local networks that participates in ACE-Net.
Intermediaries and service providers, as well as venture capital and private investors can participate to be matched.
• Commercial Finance Online, http://www.cfol.com.
Entrepreneurs complete an on-line form, which is matched against the investment criteria of those investors/ venture capital/service providers who are members.
The members are sent the e-mail address and description of the entrepreneur and can contact the entrepreneur as they wish.
Additionally the members may have a listing in the on-line directory that can be browsed by entrepreneurs.
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