FAQs for Investors:
What is an angel investor?
An angel investor (also called angel, business angel, or informal investor) is a high-net-worth individual who provides capital and resources to startups in exchange for an ownership stake. They typically invest their own funds. Many studies have shown that angels in groups consistently show higher returns than angels investing alone. As well, research shows that angel-funded startup companies are less likely to fail than those otherwise financed.
How does angel group membership benefit me?
The benefits of angel group membership are countless and varied. Firstly, members of angel groups show consistently higher returns beyond those who invest on their own. Members have access to a high-quality deal flow that individual investors do not have. The group model serves to validate individual decision making; you have access to industry experts from many different fields who can more accurately assess the success potential for a deal. You benefit from an encouraging and educational atmosphere of like-minded people. Due diligence is done by an experienced team that can formulate a stronger assessment of a deal than an investor working alone. The shared networks and resources amongst members serve to benefit the membership community and portfolio companies. As an investor with co-investors, members approach entrepreneurs from a better negotiating position and are in a better position to monitor their portfolio companies. To understand more, please contact us.
How much does membership cost?
Please contact us for more information. All services are covered by a simple annual membership fee. Members are likely to find that the cost of their membership is more of an investment with a high return: by getting access to superior deal flow, personalized guidance, education, validation of their investment decisions, a stronger negotiating position with companies, professional assistance with due diligence and term sheets, and help monitoring portfolio companies, members’ returns are likely to be much higher than if they invested alone.
There are no hidden costs to be a member and to benefit from all the services included. For an additional, discretionary fee, we provide additional one-to-one workshops and additional assistance monitoring portfolio companies.
How does WOMENA help the Gulf?
We support the growth of an entrepreneurial and competitive Gulf and we help our members make better investments to ensure this. Subsequently, entrepreneurs have higher chances of success. This helps to grow economic competitiveness in the region and to reduce the economy’s dependence on natural resources. As well, we intend to host additional meetings for social entrepreneurs and MENA-based female entrepreneurs.
What makes WOMENA different from other angel groups?
WOMENA is the first angel group in the Gulf for women only. We seek to help women in the region control their wealth intelligently and have a community of like-minded women who collaborate. We go above and beyond to make sure our investors are comfortable investing by providing extensive educational materials, guidance, and ongoing assistance, and much more. We bring together a team with varied backgrounds and expertise in this process.
How do I reduce the risk of angel investing?
Join an angel group! Studies consistently show higher returns to angels in groups. There are various services that we provide to mitigate risk, however there is no way to entirely eliminate the risk of early stage investing. It is a high risk, high potential reward activity. Educated investors take it as such and “hedge their bets,” or diversify their portfolios across numerous companies and industries. Smart angel investors generally seek to invest in companies that have the potential to return 5x+ over five years with a clearly defined exit strategy in order to mitigate the impact of failed investments. They also do thorough due diligence or get assistance with the process. All of these strategies are nearly impossible to execute outside of an angel group for most individuals.
Average IRR for a professional angel investor in a group is 20-30%, however, there is no guarantee that an investor will experience such gains. Angel investing can be an exciting and rewarding experience for a person who wants to help entrepreneurs, have intellectually stimulating investment activities and are willing to undergo the risk of early stage investing.
What if I am not an accredited investor but still want to invest?
For more information on qualifying as an accredited investor, please click here. If you do not qualify as an accredited investor, we recommend investing through one of the many crowdfunding sites where individual investors can sometimes invest as little as 100 AED in each company. We are planning to provide angel investor training and educational conferences in the future. Please sign up here for our mailing list and follow us on Twitter to hear about it.
Does WOMENA syndicate?
Yes, we welcome participation from venture capital firms, private investors, family offices, accelerators, service providers, and other angel groups. As well, we are open to ideas! Please contact us to discuss.
How much will I be expected to invest as a member of WOMENA?
The more a member invests in presenting companies, the more value they get out of their membership. Members are asked to invest $5,000-$50,000 USD in at least one company per year and it is suggested that members make three to five investments per year to diversify their portfolios and mitigate risk. In your first year of membership, members are not required to invest. After the first year, we request that members utilize their membership to the fullest extent possible and participate in at least one investment per year. Members who do not participate in the group may not be invited to renew their membership.
Is there a minimum investment amount?
At our meetings, members will see one to three entrepreneurs present their businesses for funding and are not required to invest in any. However, the minimum investment amount for an individual member is $5,000 USD per company, and at least three members must express interest in investing in order for our team to follow up and oversee the investment process.
What if I don’t invest one year?
In your first year of membership, members are not required to invest. After the first year, we request that members utilize their membership to the fullest extent possible and participate in at least one investment per year. Members who do not participate in the group may not be invited to renew their membership.
What is a WOMENA meeting like?
Monthly dinner meetings are held in a selection of elegant spaces in Dubai. Entrepreneurs are invited to chat with members during the hors d’oeurves hour before dinner. Dinner is usually started with an expert educational speaker presenting, followed by 3-5 entrepreneurs with 15 minutes each to present their company, each followed by a 10 minute Q&A; session. At dessert, we summarize discussions and assess interest in presenters. If there is sufficient interest, follow-up meetings and due diligence will be scheduled.
FAQs for Entrepreneurs
How do entrepreneurs apply?
Please click here to apply. Once we receive your initial application, we will ask for more information and set up a phone call to discuss your company. We will conduct initial due diligence. Once this is complete, you will be invited to apply. Approximately 5% of applicants are selected to present in front of members.
Does WOMENA charge entrepreneurs a fee?
There are no charges to present to our membership. We take a small success fee when companies are successfully funded. This is a percentage (usually 1-5%) of total funding received from WOMENA members. Additionally, to show solidarity with our members, we take the same risk they do, and take a small equity stake in WOMENA portfolio companies.
How long does it take for entrepreneurs to receive financing?
From initial contact to receipt of funds, usually two to four months.
What non-financial value does WOMENA provide to entrepreneurs?
Members of the group have indescribable networks and resources that they can use to help new companies. Collectively, members can help you with your business development, relationships with suppliers and distributors, marketing, finding employees, strategy, and almost any other resources or network needed in the region.
What industries does WOMENA invest in?
We are industry agnostic. We look for companies that can offer a 5x+ multiple over a 5 year period. Many of the companies fitting this criteria are internet, software, life sciences, telecom, energy, wholesale services, or retail services. We do not invest in nonprofits, films, television projects, theater projects, or real estate.
What should my business plan contain?
Your business plan should give a business summary, a product/service description, the customer problem, target market, management, customers, sales/marketing strategy, business model and financials, your competitors and competitive advantage and any additional information that you think is relevant to a potential investor. Business plans are anywhere from ten to fifty pages long and longer is not necessarily better.
Does a WOMENA member always take a board position in portfolio companies?
If WOMENA is not the lead investor, we will not expect to take a board position. As lead investor, we will typically expect a board seat to be allotted for the member leading the investment within the group.
Do you sign non-disclosure or confidentiality agreements?
No, we do not. We receive too many plans. We pride ourselves on our ethical treatment of entrepreneurs; your proprietary and confidential information will not be forwarded to anyone outside of the group or used for purposes other than determining funding suitability.
Do you only invest in female entrepreneurs?
No. We are not gender-biased for the entrepreneurs we fund. Our investors are women.