Article published on 11/3/13 in Diario de Notices by Cristo M. Borges Amador.
Frederick Terman, an engineering professor at Stanford University (California) in the 1930s, is recognized as one of the fathers of Silicon Valley. In addition to being a teacher, he encouraged his students to become entrepreneurs, founding their own companies, in which he even invested his own money.
At the time, we are talking about 1938, he invested $500 in the business project of two of his students, Bill Hewlett and Dave Packard, who, in the latter's garage, set up what would become one of the world's leading industries within the electronics industry; Hewlett-Packard (HP). This garage, recognized birthplace of what, over the years, would become Silicon Valley, was declared a United States Historic Site in 2007.
Frederick Terman can be considered an example of a business angel; people, usually veteran managers, successful professionals or entrepreneurs with their own consolidated projects, who have sufficient capital to invest in a business project presented by an entrepreneur. Due to the indicated profile, in addition to the purely economic investment, they usually support the business initiative with their network of contacts, experience and knowledge. The permanence of a business angel in the company is limited in time to the initial phase of creation and take-off of the business, which normally does not exceed five years, the date on which the investment is recovered through the previously agreed upon exit mechanisms. Furthermore, since they usually face high risk, they tend to demand an equally high return on investment (ROI), with capital gains much higher than those they would obtain in the market.
The current trend is to organize into networks, groups or clubs of angels to share efforts and pool their investment capital, given that the individual amount is usually modest; Normally they do not exceed €50,000 per investor. This is a line of financing that is not disposable, given the difficult panorama that businessmen, self-employed workers and entrepreneurs face in obtaining adequate financing through traditional financial entities. Due to the size of the investment, angel capital covers the space in the financing of a nascent business between the \"three Fs\" (family, friends, and fools), which cover small-value investments, and venture capital entities, which normally consider high-value investments.
Currently, an idea of the dimension of the phenomenon in the United States is given by the fact that 60% of technology companies (web, mobile, telecommunications and software) have grown thanks to business angels. On the contrary, in Spain it is an underused figure, where according to the IESE Entrepreneurship Center, there are around 32 associations and close to 400 active entrepreneurs. Only recently, in Law 14/2013, of September 27, supporting entrepreneurs and their internationalization, a series of tax benefits are contemplated that can promote the appearance of more business angels, such as the possibility of the investor deducting 20% in the state personal income tax quota with the investment made when entering the company (new or recently created), as well as the total exemption of the capital gain when leaving the company, as long as it is also reinvested in another entity. of new or recent creation.
In the Canary Islands, the public company SODECAN “Sociedad de Desarrollo Economía de Canarias, S.A.”, Manager of the JEREMIE Canarias Fund, has launched a private co-investment program, in which business angels may have a place, to finance projects of entrepreneurs or innovative companies in the creation phases, in the first stages or in the expansion phase of the companies
