Guidelines from ACA on Who is an Angel

The JOBS Act has thrown some confusion into the world on what an angel is, who can invest in startups and what accredited investors are. Today, the Angel Capital Associationm (ACA) released guidelines that should clarify it all.

Here are the guidelines for Angel Groups:

An “Established AngelGroup” meets the following criteria:
 The group is a private organization of accredited investors organized forthe purpose of
investing in early‐stage companies and includes one ormoremembers who have previously
invested under a Rule 506 exemption.
 Membership is only by invitation orreferralfroma currentmember who has a pre‐existing
relationship with the applicant and isfamiliar with the professional and financialstatus ofthe
applicant, and reasonably believes he orshe is an accredited investor.
 Each applicant completes a questionnaire thatincludes professional experience and sector
expertise, and certifies atleast annually that he orshe is an accredited investor.
 Membersinvesttheir own funds attheir discretion. The groupmakes no recommendation in
regard to any individualmember’sinvestmentin any offering under consideration.
 Neitherthe group nor any ofitsmembers or employees(if any)receives any transaction‐based
compensation in connection with offerings considered by the group.

HPA has met these standards ever since we started back in April of 2007.  If you want to become a member, the best way is to contact one of our existing members to find out more about how we operate, and what our expectations are.

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