In a recent article, the Wall Street Journal reported that the number of U.S. households with a net worth of at least $1 million (not including one’s home) fell from 9.2 million in 2007 to 6.7 million in 2008, and the number of households with investable assets of $1 million or more fell from 5.2 million to 4.4 million from 2007 to 2008. The Security and Exchange Commission’s definition of an accredited angel investor is having either high net worth ($1,000,000 or more) or high income ($200,000 plus for single people and $300,000 plus for married couples).
A 27 % decline in the number of millionaire households and a 15 % decline in the number of households with investable assets of $1 million or more almost certainly reduce the amount of accredited angel investment. And those investors who are accredited have less money to invest in the first place.
Given this climate, as an entrepreneur, you are going to have a more difficult time finding accredited investors. Furthermore, when you find them, you are going to have to demonstrate that your deal isn’t very risky and will provide higher returns.
{ 0 comments }
