New Utah firms making angel investment easy for everyone
When businesses think of investment – especially in these times of start-up culture – deep pockets clearly come to mind. There has indeed been millions invested in businesses throughout Utah over the past few years.
But not everyone has access to that kind of high-rate investment. That’s where several options are open for any-size business to receive some investments. Utah Business recently shared a story about how technology developed in the state has helped with small businesses who need investment.
First Utah Bank can help when those angel funds start rolling in, especially when it comes to our options for business savings.
New angels in the wings for small businesses
The company that hopes to kick-start a new wave of angel investment is Beehive Venture Partners. They launched an online platform earlier this year that gives investors who are accredited with the state a way to view startup deals in one convenient spot. This means that someone with a minimum of $1,500 can easily invest by using this app.
“Literally in five to 10 minutes you can make an investment right next to VC firms,” says Beehive’s fund manager Luke Gunderson in the Utah Business story. “It’s not the typical model at all and to invest that quickly is highly extraordinary.”
This frees up groups of people to make concerted efforts to fund a business. The story details the math behind it: 100 people with $3,000 to invest can get together on Beehive’s app to give $300,000 to a bourgeoning company.
There’s a second group called Assure Syndicate that has started something similar for investors. Its seeks to take advantage of new Utah residents (with money to invest) that have moved to the Beehive State due to the pandemic. Assure Syndicate has a network of 180 angel investors that companies can gain access to, with those angels deciding what to invest in and for what amount.
“There is a growing appetite for angel investing and growing interest from angels to invest alongside VCs,” says Landon Ainge, managing director of Assure, in the Utah Business article.
Making investment easier for more Utah residents
With both of these business making it easier to invest, a possible wave of new angels into the business stream is entirely possible. Gunderson believes that even people who aren’t in the highest wealth strata qualify to be accredited, which is why he and Ainge seek to make the steps to pursue that accreditation easier through their companies.
“It’s important that the newly wealthy do not have a sour experience with their first attempts at angel investing so we can keep a vibrant early-stage capital market going,” says John Richards, a BYU business/entrepreneurship professor who is also an angel investor. “Beehive and Assure offer a cocooned environment for angel investors so they hone their skills at venture investing.”
Both Gunderson and his brother, Jordan, know about the angel market firsthand. Jordan Gunderson – who co-owns Beehive – also runs a startup software development company called Start Studio, and he told Utah Business that some investors were turned off by the price of the software build and would change their minds about investing.
With Beehive, they decided to bring more investors into the fold for what is in essence a group buy for individual businesses, sharing the burden of investment and also transforming the way funding takes place in Utah.
“We want to change the amount of Utahns on the cap table and bring those returns back to the community and hopefully they can reinvest here,” says Luke Gunderson. “And we hope to add as much fuel to that fire as possible.”
Think about the best approach to savings for your Utah business
As your hometown financial expert, First Utah Bank is a trusted advisor when it comes our own business savings options.
There are two options that businesses have when it comes to business savings accounts through First Utah Bank. The first is the standard savings account which keeps your money safe while also giving you the convenient opportunity to watch it grow. There are no monthly service fees and no minimum balance that you need to maintain. This way, you can have the funds needed for unexpected expenses as your business grows and expands.
Then, there is the High Yield Money Market account for businesses. With this option, you can still get access to your funds easily, but it also allows you to earn a higher rate on larger balances. This competitive rate helps grow your money fast, as interest is compounded and credited monthly. It’s also insured to the legal maximum by the FDIC. Note that you need have $25,000 in your account to not pay a monthly service fee.
As the evolution of your business in Utah continues, also know that you have First Utah Bank on your side to help along the way, whether it’s for savings or any other banking need. Find out more about at our website, or call us at 801-308-2265.