Frequently Asked Questions
1 - Who is Angel Investor?
Angel investor is a personal investor who purchases minority shares (maximum 50 percent) in ventures with a high growth potential and intends to leave by selling his shares within 2 to 7 years.
In Turkey, angel investors may be licensed by the Treasury Under secretariat if and when they meet particular requirements. They are eligible for tax incentives if they make investments with an Individual Participation Investor License in industries determined by the Treasury Under secretariat.
2 - What is the Philosophy of Angel Investment?
As the name suggests, angel investment is basically a type of investment aimed at doing a favor and kindness. Angel investors make investment in risky projects with a high growth potential, and a certain time after investing, leave by selling their shares therein.
3 - Who may be Angel Investor?
Everyone intending to make investments in tandem with angel investment philosophy may be an angel investor. Angel investors may be an individual, group or corporate, but what’s important is making investment in line with the underlying philosophy.
4 - Why does one become an Angel Investor?
There are many reasons of being an angel investor. As mentioned by Scott Shane in his book Fool’s Gold, the reasons may be briefly listed as:
• Doing a favor
• Earning money
• Getting fun
• Being a part of other firms
• Learning new things
• Becoming a proprietor
• Contributing to entrepreneurship ecosystem
• Contributing to project of an acquaintance
5 - What do Angel Investors Invest in Ventures?
Angel investors invest in ventures their life expectations, knowledge, business network and capital. And they act as a mentor and advisor for the sake of rapid growth of ventures. They also lend their future expectations and growth targets to ventures.
6 - What are Expectations of Return on Investment of Angel Investors?
Expectations of return on investment of angel investors are generally dependent upon the industry and current stage of the project. In general, expectations of return on investment are an increase of 3 to 14 times the value per share. However, these expectations may at the same time be zeroed due to risk potential of ventures.
7 - What is Positioning of Angel Investors in Ventures?
Within the frame of angel investment philosophy, in general, investor is not included in the management staff of company. Mostly, angel investor leaves the company management to entrepreneur and relies upon the skills and capabilities of entrepreneur.
8 - What are Characteristics of Angel Investors?
Angel investors are basically wealthy individuals. Through their assets, while investing in traditional financial products on one hand, they also wish to invest in an alternative and exciting area on the other hand.
In general, an angel investor must be patient, excited and innovative, with developed communication skills and a wide communication network, capable of long-term planning and strategic thinking, having time to spare for entrepreneurs, and fond of learning new things.
9 - How Much Budget should be reserved for and How Many Ventures should be invested by Angel Investments?
Those wishing to start angel investment must particularly and initially reserve an amount equal to 5 to 10% of their investment budget for investments in ventures.
It is rational to invest the budget reserved for angel investments in minimum 5-6 companies, because each venture / investment may not result in success.
10 - What is the Chance of Success of Ventures?
Particularly, most of the investments made in USA have revealed that approximately 8 out of every 10 enterprises fail to reach the desired level of success after investment. In general, high income of other ventures facilitates the success of them.
11 - How is Angel Investment Platform Operated?
Angel investment platform is designed to enable wealthy individuals to see, evaluate and invest in certain ventures through a project showcase. Investors have an idea about ventures by having access to information provided by entrepreneurs about their projects, and if they are interested therein, they are brought together with entrepreneurs.
12 - How can I invest in Angel Investment Platform?
Angel Investment Platform basically enables TEB Private Banking customers to see tens of projects and to choose the best investment alternative(s) for them. After entering the platform, it will be sufficient if you select the relevant project and click on the option “I wish to get information”. Our platform supervisors will collect information about the project you are interested in, and will immediately revert to you.
13 - How can I reach Detailed Information about Projects in the Showcase?
It is sufficient if you click on the button “I wish to get information” at the left side in the relevant project page. Our platform supervisors will collect information about the project you are interested in, and will immediately revert to you.
14 - I want to meet the Project Owner. What must I do?
It is sufficient if you click on the button “I wish to get information” at the left side in the relevant project page. Our platform supervisors will collect information about the project you are interested in, and will immediately revert to you. After your expectations are clearly understood, a meeting will be organized at the most convenient date for you and the related entrepreneurs.
15 - I want to be a Mentor for Project. What must I do?
Mentorship is a bilateral structure in Angel Investment Platform. First, mentorship for candidate angel investors, and secondly, mentorship for entrepreneurs.
In the platform, projects specify whether mentorship is requested or not, and if so, in which field. Thus, in the case of a demand in the field you are wishing to act as a mentor, you inform us, and we initiate the process of matching your wish with the demand of project owner.
16 - I know Some Individuals Who I believe may be Useful for Development of Project. What must I do?
It will be sufficient if you contact us. We are going to take necessary actions for bringing two sides together.
17 - Which Factors are taken into Consideration in Evaluation of Ventures?
A venture must have some certain characteristics in order to be successful. These characteristics put forward the potential of ventures and are generally questioned under the following headings:
a) Is it a specific and unique project?
b) Does it have an added value?
c) Is it innovation-based?
d) Is its growth trend high?
e) Is it sustainable?
f) Is it measurable and scalable?
g) Does it have the chance to develop in international markets?
h) Is it ready for sale?
i) Can it be realized under the currently available circumstances?
j) Does it have the demand potential in market?
k) Does it contribute to emergence of new projects?
18 - How is Ventures Selected in the Platform?
Our Angel Investment Platform advisors are entering into one-to-one negotiations with all firms, and making their selections on the basis of many criteria. All of the projects exhibited in the platform are fit for angel investment, and vary according to different behaviors of angel investors.
19 - Am I required to hold an Individual Participation Investor License in order to Make Investments in the Platform?
Holding an Individual Participation Investor License is not required for taking part and making investments in Angel Investment Platform. Individuals decide how they wish to make investments according to their own wishes.
20 - What is Individual Participation Capital (IPC)?
IPC is a financial tool used for meeting the financial needs of enterprises exposed to a high risk due to still being at an early stage. In addition, they capital type is a reliable financial instrument for entrepreneurs as it ensures increase of professionalism and domination of market by a certain behavioral culture and ethical rules.
21 - What does IPC System cover?
Purpose of IPC System is to provide incentives to individuals over personal income tax by ensuring that Individual Participation Investors are licensed and are encouraged to make investments in supported industries through this license.
22 - How can I get an Individual Participation Investor License?
First of all, it is checked whether you meet the conditions and have the qualifications required for an IPI license. If all conditions are met, an application is filed to the Republic of Turkey, Treasury Undersecretariat through accredited IPI networks.
23 - What will my Advantages be With an Individual Participation Investor (IPI) License?
Thanks to this system supporting the entrepreneurs, a reliable financial ecosystem is created. Making IPC investments more attractive through state subsidies and supports will increase investments and pave the way for ventures.
24 - What is the Difference Between Angel Investor and Individual Participation Investor?
Both terms have the same meanings. The concept termed as angel investor by circles of entrepreneurs is named as “Individual Participation Investor” in the regulation issued about Individual Participation Capital.
25 - Who gives IPI Licenses?
IPI licenses are basically given by the Republic of Turkey, Treasury Undersecretariat, and licensing process is managed through accredited IPI networks.
26 - What are Qualifications Required for an IPI License?
Holding an IPI License requires satisfaction of all criteria enumerated in the Regulation issued about Individual Participation Capital by the Republic of Turkey, Treasury Undersecretariat. These criteria are mainly gathered under two headings:
• To have a high income or wealth level:
- Investors with an annual gross income of 200 thousands or more, or
- Investors with a total personal wealth of more than 1 million lira.
• To be experienced:
- Investors experienced in banks, financial institutions and high turnover companies, or
- Investors having job experience as a manager in domestic incubator centers and being a member of IPI network.
27 - What is the Duration of IPI License?
License duration is 5 years. License may be renewed if demanded at the end of this time. To this end, it is again checked whether the criteria are satisfied or not.
28 - Do I have to pay any Fee for IPI License?
No. However, accredited networks may charge a certain amount of fee.
29 - Is IPI License valid internationally?
An individual participation investor license is valid only in Turkey.