What are the membership requirements for the Duke Angel Network?

Duke Angel Network members are required to be affiliated with Duke University and be accredited investors. Most Duke Angel Network members are alumni, but faculty, staff, students, parents, and donors are also eligible for membership. Graduates from any of Duke’s undergraduate or graduate programs are eligible for membership.

To be an accredited investor an individual must have over $200,000 in annual earned income (or $300,000 together with a spouse) or have a net worth of over $1 million (excluding the value of their primary residence). For more information on accredited investor requirements, please see the SEC’s accredited investor bulletin.

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What types of companies will the Duke Angel Network invest in?

The Duke Angel Network invests in Duke-affiliated startups. Companies must meet the following criteria to be considered for investment:

  • Have a founder, executive, or board member who is a Duke alumnus, faculty, staff, student, or parent.
  • Raising seed or Series A equity capital of $300,000 to $3 million or syndicating later-stage equity financings with an existing institutional lead investor
  • Located in the United States

The Duke Angel Network facilitates investments by its members in companies that have the potential for high growth and significant financial returns. When filtering opportunities for review by DAN Members, the DAN Screening Committee looks for the following attributes:

  • A large market opportunity;
  • A unique value proposition;
  • Proprietary technology, intellectual property, or other basis for sustained competitive advantages;
  • A dedicated management team;
  • A corporate structure that allows for equity investment at defined terms and conditions;
  • A strategy and plan that has the potential to produce venture grade returns.

The Duke Angel Network’s operating team actively seeks input and feedback on members’ areas of interest and focuses its efforts on areas in which members have particular preferences. Due to the importance of angel and venture capital funding, as well as the expertise of current members and the operating team, the Duke Angel Network sees more investment opportunities in information technology and life sciences relative to other industries.

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Are members committing capital to a fund? Is there a requirement that members invest in opportunities that other members have decided to invest in?

No. Duke Angel Network members are not committing capital to a fund and are not required to invest in any deals. Individual members are free to either invest or not invest in any opportunity as they so choose.

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Are there minimum annual investment amounts or annual membership fees?

There are no minimum annual investment amounts for Duke Angel Network members. Members are expected to be active in the network and to be available for advice, guidance, and opinions to support investment decisions and to help portfolio companies grow.

Members are required to pay a $1,000 annual membership fee. This fee helps fund the operations of the Duke Angel Network, which includes both services and resources. DAN is a manager-led angel group with an Operating Team of professionals that devote all or a portion of their time to delivering services to members, as well as the following resources:

  • An online software platform that enables the operating team and members to communicate and collaborate on diligence and investment decision making
  • A website that describes the network in detail for entrepreneurs and investors
  • Pitch events and networking events for members around the country and on campus

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Are there any management fees or investment fees?

No, the Duke Angel Network does not collect ongoing management fees or transaction-based investment fees. All operations are funded by membership fees, Duke University, and donor support.

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Who is involved in running the Duke Angel Network?

The Duke Angel Network is run by an Operating Team that includes:

  • Steering Committee: Entrepreneurial leaders at Duke who guide strategy and operations
  • Managing Director: An investing professional with extensive experience in deal sourcing, diligence, transaction structuring, and investor relations who runs the operations of the network
  • Student Fellows: Students from across Duke University who provide support across all aspects of the network including deal diligence, transaction management, and communications.

The Operating Team is supported by guidance and oversight from an Advisory Board, consisting of world class experts from the Duke entrepreneurial community

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What services are provided by the Operating Team to Duke Angel Network Members?

  • Deal Sourcing
    • Actively seeking out investment opportunities that fit with member preferences
    • Developing early access to investment opportunities with companies where the Duke Innovation & Entrepreneurship Initiative leadership has previously developed a trusted relationship
    • Developing unique access to financings where entrepreneurs or other investors agree to reserve an allocation for the Duke Angel Network
  • Deal Flow Management
    • Managing a broad deal funnel and communicating throughout the process with applying companies
    • Gathering and packaging detailed information for each company for efficient consumption by members
  • Deal Screening
    • Reviewing all deal opportunities in detail, which often includes a company pitch/meeting
    • Filtering deals based on the strength of the business and the fit with member preferences
  • Due Diligence
    • Defining diligence requirements
    • Gathering additional information from companies
    • Performing independent research and analysis, and gathering insights from relevant experts
    • Compiling diligence results and summarizing investment strengths and weaknesses
  • Transaction Management
    • Assisting members in structuring, negotiating, and completing investment transactions
    • Managing relationships with syndicate partners such as other angel groups or institutional investors
  • Portfolio Management
    • Monitoring and advising DAN portfolio companies throughout their life cycle
    • Connecting companies with the broader resources of the global Duke community, including faculty, students, alumni, and partners
  • Member Recruitment
    • Marketing and communicating with prospective members
    • Managing the application process
  • Event Management: planning, scheduling, and coordination of pitch events and networking events for DAN members

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How does the Duke Angel Network source and screen potential investment opportunities?

The Duke Angel Network actively sources investment opportunities from existing members, the Operating Team, and the global Duke community, as well as direct applications via the Duke Angel Network website.

The Duke Angel Network’s operating team screens investment opportunities based on the preferences of angel members and readiness for investment before presenting opportunities to members.

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What analysis or advice does the operating team provide to members considering a particular investment?

The operating team provides active guidance and support throughout the investment process, including:

  • Sourcing deal opportunities to supplement deal referrals from members
  • Screening initial company applications
  • Managing information dissemination between the companies and members
  • Managing process and communications during diligence
  • Performing diligence tasks and analysis as needed
  • Supporting the investment transaction process

The team does not provide investment recommendations. All investment decisions are made by individual members and all investments are made directly from members to companies. The team operates a platform and process that enables informed decision making in a timely manner.

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What are the responsibilities of Duke Angel Network Members?

Duke Angel Network members are expected to be active in the network. This includes actively sourcing investment opportunities for the group, collaborating and contributing to diligence processes and investment decisions, participating in the investment process on a regular basis, and providing support and guidance for portfolio companies based on experience and expertise.

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What support does the operating team provide following an investment?

The operating team is active in monitoring and advising Duke Angel Network portfolio companies. Such support can take many forms, including advice on business strategy and tactics, introductions to potential customers or partners, assistance with recruiting, and facilitation of future financing rounds or exits.

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What are the requirements to receive an investment from the Duke Angel Network?

The Duke Angel Network invests in Duke-affiliated startups. Companies must meet the following criteria to be considered for investment:

  • Have a founder, executive, or board member who is a Duke alumnus, faculty, staff, student, or parent.
  • Raising seed or Series A equity capital of $300,000 to $3 million or syndicating later-stage equity financings with an existing institutional lead investor
  • Located in the United States

The Duke Angel Network facilitates investments by its members in companies that have the potential for high growth and significant financial returns. When filtering opportunities for review by DAN Members, the DAN Screening Committee looks for the following attributes:

  • A large market opportunity;
  • A unique value proposition;
  • Proprietary technology, intellectual property, or other basis for sustained competitive advantages;
  • A dedicated management team;
  • A corporate structure that allows for equity investment at defined terms and conditions;
  • A strategy and plan that has the potential to produce venture grade returns.

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What role will Duke Angel Network members play in the companies they invest in?

In addition to being shareholders in portfolio companies, Duke Angel Network’s members will provide support and guidance for portfolio companies based on experience and expertise. This could include advice on business strategy and tactics, introductions to potential customers or partners, assistance with recruiting, and facilitation of future financing rounds or exits. When appropriate, members may be asked to serve on the board of directors of portfolio companies. Members will not be required to serve on boards.

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What value-add capabilities does the Duke Angel Network bring to companies its members invest in?

In addition to the involvement of members with relevant experience and expertise, the Duke Angel Network enables portfolio companies to leverage the broader resources of the global Duke community. This could include support from University faculty, project assistance from student internships, and targeted access to the University’s alumni and partner network. Most importantly, the operating team will actively match companies with expertise in the global Duke network.

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What is the process for companies seeking investment?

Companies initiate the process by completing an online application. Once the application is complete, the following process steps will be followed:

  • Initial Screening: The Steering Committee will assess the company’s readiness for investment and fit with investor member preferences. Companies should be informed of the initial screening decision within one week of completing an application.
  • Posting: Company information will be posted to a private, secure, online collaboration platform that allows members to review company information and indicate any initial interest in the investment opportunity. If sufficient interest is generated from members, the company will be informed that the network would like to move into diligence.
  • Diligence: Interested investors will form a diligence team with a diligence lead who will interact directly with the company to move through the diligence process as quickly and effectively as possible. This process may involve pitch sessions in person or remotely via video/teleconference.
  • Subscription: Results of the diligence process will be disseminated to all members, and interested members will subscribe to the investment opportunity.
  • Transaction: With the help of the operating team, the syndicate of interested members will work with the company to structure and complete the investment transaction.

The operating team will provide support and resources at all stages of the process.

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What documents should companies seeking investment have prepared?

For initial meetings, companies should at minimum have a corporate overview presentation describing the market opportunity, the company’s solution, and the current team, as well as other information such as current and potential customers and partners, competitors, and any other information the company would deem appropriate. A long-form business plan and financial projections would also be appropriate for an initial meeting.

Subsequent meetings and due diligence will cover additional topics more in-depth, and could include product usage statistics (e.g., orders, shipments, subscribers, active users, downloads, website traffic, etc.), product development plans / roadmaps, pricing plans, detailed historical and projected financial statements, capitalization tables, hiring plans, partnership and licensing agreements, customer contracts, customer and prospective customer reports, marketing survey results, product ratings and reviews, intellectual property documentation, and other corporate documents.

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Does the Duke Angel Network continue investing in later rounds for companies it has invested in previously?

Members will consider investments in follow-on financings on a case by case basis. In general, companies should assume that the Duke Angel Network will not be a source for significant additional capital. Members are typically focused on helping companies get through the early stages of growth with seed stage capital.

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Does the Duke Angel Network sign non-disclosure or confidentiality agreements with companies it is considering for investment?

The Duke Angel Network does not sign non-disclosure or confidentiality agreements. Company information is shared with members through a private, secure online platform. Members are expected to keep all information confidential and to use information only for purposes of making investment decisions. Members are not bound by a confidentiality contract with the Duke Angel Network; however, the operating team closely monitors the dissemination of information within the network, and any investor member who distributes information outside the network without consent will likely be asked to leave the group.

At later stages in the diligence process, individual members may be asked to sign an NDA or CA directly with the company. These agreements will not include the Duke Angel Network as a party.

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Can entrepreneurs and companies see a list of members in the Duke Angel Network?

No. The Duke Angel Network respects the privacy of members and will not publish a membership list. As companies enter the formal diligence process with the Duke Angel Network, interested members will be introduced to the company. Background information can then be shared directly by members with companies.

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What is the Duke Innovation Fund?

The Duke Innovation Fund consists of philanthropic contributions that are targeted at entrepreneurship across the global Duke community. The Fund will match angel member investments in each DAN investment, with matching amounts at the discretion of the Steering Committee. All proceeds are returned to the fund and reinvested in companies. Duke University has committed $2 million to the fund with an initial target size of $20 million in committed capital.

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What is the difference between the DAN and the DIF?

The DAN is a membership network. Members must be accredited individual investors with a Duke affiliation and pay an annual membership fee of $1000. DAN members invest directly into Duke-affiliated companies. The DIF is a philanthropic fund that will invest in companies that have been selected for investment by at least one member of the DAN, with guidance provided by the DAN steering committee.
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