By guest authors Irina Patterson and Candice Arnold
This is the fiftieth interview in our series on financing for entrepreneurs. I am talking to Marianne Hudson, executive director of the Angel Capital Association.
Overland Park, Kansas-based ACA is is a non-profit trade association. It counts among its members more than 150 angel groups throughout the United States and Canada that represent more than 6,500 angels. The mission of ACA is to support the growth, financial stability, and investment success of member angel groups.
It provides professional development, best practices, networking, and collaboration opportunities for angel investors who belong to member angel groups. The organization also serves as the public policy voice of the angel community and is focused on advancing state and federal policies that support and promote angel investing.
Irina: Hi, Marianne. Why don’t you start with your background and how you arrived at this point?
Marianne: I think I’ve cared about the growth of businesses, small businesses in particular, probably since I was a teenager. That really got me into working with a lot of organizations that supported entrepreneurs, manufacturers, and the economy in general.
I’ve worked in a couple of state technology-based economic development organizations that were trying to build a right environment for businesses to grow, create jobs, and things like that. Then I spent time at the Kauffman Foundation, which is the largest foundation that focuses on entrepreneurship and the growth of entrepreneurs.
[My work at Kauffman] resulted in the creation of the Angel Capital Association and its sister organization, the Angel Capital Education Foundation (ACEF).
Irina: Where did you go to college?
Marianne: I have an undergraduate degree from the University of Kansas in economics and political science and a master’s degree in public policy from Rutgers.
Irina: What year was the Angel Capital Association formed?
Marianne: I think the official year was 2005. There was some history and evolution behind that. In 2002, I got a call from James Geshwiler, who runs Common Angels in Boston. I was at the Kauffman Foundation, and he mentioned that there were angel groups forming, but they really needed a good way to talk to each other, compare notes, and get data.
They needed an industry analyst, if you will, and [they wanted to know] if the Kauffman Foundation was interested in sponsoring a meeting to get folks together to start talking to each other and comparing notes. So, we hosted one meeting in early 2002 that led to four more meetings like that. More and more angels kept coming, and it became obvious, after a couple of years, that they wanted a formal way to learn from each other. And the association was formed.
Irina: And what about its sister organization, Angel Capital Education Foundation?
Marianne: The sister organization, ACEF, became a way for the Kauffman Foundation to truly support the work of the angels. Philanthropic foundations need to fund charitable work. So, the ACEF focuses on the more charitable aspects of our work: education and research about angel investing, not just for angels, but also for entrepreneurs, policy makers, and the entire entrepreneurial community.
Irina: What were your responsibilities at the Kauffman Foundation?
Marianne: My title was director for entrepreneurship. I worked with entrepreneurial growth activities. So, everything from training programs aimed at entrepreneurs wanting to start and grow businesses to websites that provided a lot of information about being an entrepreneur to just thinking through strategies and research about high-impact entrepreneurship.
Through that, I started doing the work with angels, because we found during our research that startups needed not only a lot of support and mentoring, they also needed startup capital. Our research helped us find that about 90% of the outside equity capital for startups came from angels.
Irina: What is the structure of ACA?
Marianne: The Angel Capital Association is a non-profit trade association. We have 150 member angel groups throughout the United States and some from Canada. Those angel groups have as their members about 6,500 angels, who are accredited investors. We have another 25 whom we call affiliates. They’re organizations that are important for or friendly to angel investors.