Macleans | Sarah Barmak | Jan 19, 2015

More women are entering the risky field of angel investing—and finding they thrive in it

Back in 2001, at an angel-investing conference in Toronto—a gathering of wealthy individuals who provide early-stage funding to start-up businesses, hence the divine moniker—Coralie Lalonde was an unusual sight. As the precocious mid-thirties founder and CEO of angel-investment group Katsura Investments, she was among peers. But as the event went on, she looked around the room and began to count. “I went, ‘Wait a second, am I the only girl here?’ ” she says.

Indeed, amid the sea of suits, Lalonde spotted fewer than 10 women, and after learning they were representatives from investment firms or government, she realized she was the only female angel among the 134 attendees at the event. Not that she ever felt out of place there, or at any subsequent angel-investor events where the entrepreneur and former contractor for Nortel would hear pitches from companies looking for backers. “It’s not intimidating because I don’t need to be there,” she says. “I’m invited because somebody wants something from me. You may or may not be considered an equal, but it doesn’t really matter. Don’t treat me as an equal? Fine—you don’t get my money.” [tweet this]

Today Lalonde, now 49, is a pioneer among the rising number of women in Canada jumping into the risky, male-dominated world of angel investing—and finding they thrive in it. Although the National Angel Capital Organization (NACO) doesn’t track the gender of Canadian investors, those in the angel-investor community say they’ve seen the landscape shift as more women gain wealth and long, accomplished careers in business.

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“There are more women angel investors now than there were 10 years ago,” says Ottawa’s Caroline Somers, who has invested in roughly two dozen companies, many through angel group Band of Scoundrels, of which she is a managing partner (angels often form groups to invest together or pool advice). Together with Jennifer Francis, Somers is also co-chair of the Capital Angel Network, which is about 15 per cent female.

While women still make up a relatively small part of the angel-investor community, many are influential. Just 10 years after that Toronto summit, NACO named 45-year-old Calgary green tech entrepreneur Michelle Scarborough its first female chair. The Network of Angel Organizations’ Ontario branch got its first female chair, Patricia Lorenz, in 2008; she only recently stepped down.

This past June, Scarborough founded an angel group specifically for women—the first one in Canada, to her knowledge. With members from Calgary, Vancouver and Edmonton, she hopes the informal, as-yet-unnamed group will eventually blossom into a national organization, inspired in part by U.S. group Golden Seeds, which connects female and male investors with female entrepreneurs.

A relatively new investor class in itself, angels provide critical capital to early-stage companies, getting equity or convertible debt in return. In the past decade, the barriers that stood in the way of women becoming successful angels have begun to fall away. For one thing, there are simply more independently wealthy women than in the past. Under securities laws, in order to invest in private companies, angels must possess at minimum financial assets in excess of $1 million (not including pensions or the value of personal residences). Far more important than being rich, though, is having a seasoned career at high levels of business to draw on when judging the merits of new start-ups and inexperienced CEOs. Women who elbowed their way into the testosterone-filled corporate milieu of the 1980s and 1990s are reaching retirement, many of them relatively young and with executive experience. Those women are now injecting anywhere from $25,000 to $750,000 into myriad industries, from green energy to computer technology to genetic research, in the hopes of getting in on the ground floor of the next big thing. “As women get more experienced in business and understanding what the risks are, their appetite for risk is increasing,” says Somers.

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