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By Cassandra Chew
A STRUGGLING woman entrepreneur, who runs a handbag business from her home here, snags a deal with a top department store.
But to expand her business, she needs funding urgently. She seeks an angel investor - a wealthy person who provides capital in start-ups in exchange for debt or equity.
Enter Mr Bill Morrow, the founder of Britain's largest angel investor network which has spread its wings to Singapore.
During the meeting, he does not check out the strength of her business plan or the quality of her products. What he was looking for was her love for the work, the 49-year-old Scotsman said, in recounting the encounter to Insight.
Impressed by her enthusiasm, he has arranged for her to make her first pitch to angel investors at a speedfunding event on March 23. He is confident that she will secure funding.
He notes: 'Three of the four deals we did in Europe last month have been based on personality, on the angel seeing some spark, and almost investing in the person rather than the idea.'
Experience tells him that angels are drawn to entrepreneurs who know well what they are into, and are able to communicate their passion.
Mr Morrow should know, as head of London-based Angels Den which boasts a membership of more than 3,000 angels and 10,000 entrepreneurs worldwide, and as an angel investor to more than 10 companies in Europe.
Since Angels Den Asia was set up here on March 1, it now counts more than 300 angels, mainly from property and financial services circles here, and 11 companies, including a fish farm, a yoga club, a palm oil factory and three high-tech firms.
After graduating from the University of Edinburgh, Mr Morrow started out as an accountant with a venture capital organisation and became an investment banker before striking it out on his own.
After a series of negative attempts to secure angel funding for his own projects, he decided to start his own network with his partner Lois Cook, 48, in 2007.
Having experienced it first-hand, he understood the difficulties of entrepreneurship. That is why he is doubtful the Singapore Government's new tax incentives will draw more angel investments.
During his Budget statement on Feb 22, Finance Minister Tharman Shanmugaratnam announced a 50 per cent tax deduction on investment for angels who commit at least $100,000 to a start-up for two years. The deduction will be capped at $500,000 of investments.
According to Mr Morrow's sums, the incentives could work out to an immediate 10 per cent return on investment for angels. But angels very rarely invest on the back of tax incentives, or tax regimes, he points out in an interview at The Fullerton Hotel.
'You imagine that would be a really big thing for most angels but it's not. Tax saving isn't what they're investing for.'
But he admits that Angels Den sign-ups by Singapore angels shot up from one or two daily to 42 on the day after news of the tax incentive broke.
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