VentureSouth, an angel investor network based in Greenville, South Carolina, is expanding to Atlanta. The firm expects Atlanta to become its largest chapter, said Charlie Banks, managing director.
VentureSouth is in 18 markets across the Southeast, including Charlotte. In 2020, the company was recognized as a top 10 angel group in North America by the Angel Capital Association. The ranking was based on making 30 investments and deploying $12.7 million in 2019.
VentureSouth joins the 100 Black Angels & Allies, Atlanta Technology Angels and the national Keiretsu Forum as angel investment networks in Atlanta. The expansion comes amid an economic downturn, leaving company valuations low and making it more difficult for startups to raise money. But those market conditions don't affect the early-stage startups targeted by angel networks quite as much.
“The reach of our angel community is generally limited to the greater metro-Atlanta area,” said John Yates, technology attorney at Morris, Manning and Martin. “VentureSouth is one of the most successful regional angel and early-stage funds in the country, so we have the benefit of financing tentacles in an organized fashion we didn’t have before.”
Within a year, Banks sees Atlanta membership growing to around 100 investors. Chapter membership for the company ranges from a dozen to about 100.
Earlier this month, VentureSouth participated in a $2.8 million investment round into Atlanta-based talent marketplace startup Wripple Solutions Inc. Other Atlanta companies in its portfolio include Package Solutions Inc.
Founded in 2008, VentureSouth’s membership includes over 400 investors and has deployed over $80 million in more than 80 companies, according to its LinkedIn page. Members of each of the company’s chapters hold monthly meetings. Who the Atlanta chapter’s market leader will be or where the meetings will be held have yet to be determined.
The company invests in businesses that are based in the Southeastern U.S. and are seeking $250,000 to $2 million for a 15% to 35% equity stake. Other chapters include Charlotte, Asheville, and Raleigh in North Carolina; Charleston and Hilton Head in South Carolina; and Richmond, Virginia.
Companies that receive investments don’t have to be based where the chapters are, but Banks says the move will benefit Atlanta’s economy thanks to recycled capital that will accrue from the return on investments.
“With us having a more formal presence and actually having meetings, that core group gives us the ability to really start to build a much larger group,” said Banks. “The larger the group, the larger the check we can write, which attracts better deals.”
As part of its presence, the company provides educational resources to its investors. Its curriculum addresses different aspects associated with early-stage investing, including understanding capitalization tables, term sheets, valuations, due diligence, board governance and exit strategies.
Prior to adding an Atlanta location, the company’s most recently added market is Richmond. It will soon be adding another in Chattanooga, Tennessee.
