The Investing Women network will make its debut and start working with companies preparing for investment over a two-day event culminating in a gala reception hosted by the chief executive of the City of Edinburgh Council, Sue Bruce.
Between 60 and 70 “high net worth” women are expected to attend the event on 28 August with a view to becoming part of the investor group.
Jackie Waring, the founder and chief executive of Investing Women, expects that those involved will be ready to invest mainly in women-owned business by the beginning of next year.
The concept is modelled on established female-led investor programmes in the US where there has been a rise in business angel investment by women from about 3 to 4 per cent in 2005 to more than 22 per cent last year.
Waring said currently only 2 per cent of angel investors in the UK are female, but they are a new source of capital for small businesses in the form of much needed seed and early- stage funding. She said: “This is an enormous gap in the market and an enormous market opportunity.”
Waring cites recent statistics which show that the recession has hit wealthy angel investors, reducing capital for new firms. Recent statistics show that while angels in Scotland pumped funds into 123 companies in 2011-12, only 19 were new investments.
“There is a desperate need for new investment capital in the Scottish market,” said Waring. “It is not coming from existing investors groups. It is largely due to the economy. They need to do repeat rounds of funding because the recent investments protect the original and they have taken a much longer period of time to exit.”
Attending the Scottish event will be Susan Preston, dubbed America’s first lady of business angels and who is currently partner of San Francisco-based CalCEF Clean Energy Angel Fund. She will deliver a “masterclass” in angel investing for the potential new angels.
The event will also include pitches from six promising female entrepreneurs that could be among the network’s first investments. These include Lauren Currie, co-founder of service design agency Snook; Jordan Shaw, founder of social network Silver IMP; Karen Glen, founder of careers firm Curriculo Solutions; Sonja Henrici, a filmmaker whose production company Cycling Film will produce feature films about bike racing, and Nicola Hillhouse, developer of conference media software, Confbuzz.
The group will not exclude men – either as investors or investees – but will instead focus on addressing female investor and entrepreneurial “needs” not met by traditional, male-dominated investor networks.
“One of the biggest differences is that a woman’s approach is often misinterpreted as risk aversion – it is not risk aversion it is risk management,” said Waring. “Research also shows that women will take longer to set up a business because every bit of research will be explored and every bit of planning will be done before going live. It is the same when it comes to investment. The women we are talking to who are new to investment want to learn about this thoroughly before going live with it as investors themselves.”