If you’ve ever watched Dragons’ Den, you’ll have a pretty good idea of what the Northern Ontario Angels Group (NOA) does, helping connect small- to medium-sized Northern Ontario entrepreneurs with angel investors and partners. Except, says executive director Mary Long-Irwin, without all the TV drama.
“It’s just been so incredibly successful,” Long-Irwin said. “There is some advantage when you are working with smaller communities because a lot of the investors know the companies. A very large percentage of them owned their own business (in Northern Ontario), and that’s how they made their money.”
Some of the success stories include Yuleys protective footwear, Global Hydration, and mycommittee.
This past summer, NOA celebrated 100 completed deals worth $40 million in angel investments, making it the most successful program of its kind in Canada.
Figures range from $25,000 to $5.5 million of capital for businesses from just north of Barrie to the Manitoba border. Those businesses have created approximately 1,170 well-paying jobs in the North. Most investors come from the region though some come from a far away as Boston, San Diego, Chile, and Brazil to align themselves with innovative projects taking place here.
Investors tend towards geographical regions or industries they are most familiar with, including a growing number of First Nations businesses.
It’s not just a way for business people to “give back” to the region though – investors do expect a return on their money, enjoying an average rate of return of 18 per cent, Long-Irwin said.
Investors also provide mentorship, lending their years of business and industry experience to new businesses starting out.
“Even though they may be in their late 50s and 60s, they are still young enough that they can give the time that the entrepreneur needs, that the company needs,” Long-Irwin said. “They get a nice rate of return and they have done what they really wanted to do, which was grow the economy so that their kids and grandkids can stay here.”
The group launched in 2005 under the name Northern Ontario Entrepreneur Gateway. For the first five years, it focused on helping new businesses become “investor ready” through workshops and other resources. That’s still a big part of the mandate, but now NOA is also able to take entrepreneurs through to the next step of finding business partners.
“They can use that capital for operating costs because there aren’t any grants for that – it’s hard to get,” Long-Irwin said. Investors may bring other assets to the table including office space, connections, and even business personnel.
Long-Irwin said the program also has an excellent ROI for FedNor, which funds the program.
“If you divide those 1,170 jobs by the amount of money that FedNor has put in, it’s an amazing return for the tax payer,” she said.
The NOA is overseen by a board of directors spread across the region, bringing a balanced, local perspective.
“We’re very fortunate that our board is diversified (across different industries),” Long-Irwin said. NOA also has advisers who can provide community- and industry- specific guidance to help Long-Irwin evaluate business proposals. The program is expanding with part-time people in Sudbury, Sault Ste. Marie, North Bay, and Timmins along with Long-Irwin in Thunder Bay to manage the rapidly growing program.
Ultimately, NOA is there to help businesses get off the ground and provide investors with unique – and local – investment opportunities. The end result is an innovative way to help spur economic growth throughout Northern Ontario.
“That’s what I think these investors are: community builders, one business at a time.”