As part of my quest to build a diversified investment portfolio, I recently came across the Angel Business Club which is a passive style of investment.
This interests me as I don't want to have to work too hard for a return on my money, I mainly want investments that I can set up and let run and hopefully sit back and watch the money roll in.
The Angel Business Club is designed to do all the hard work and research for you with their professional team of investors, so it looks like an ideal service for me to get involved in.
I'm a complete novice when it comes to investing in businesses and buying shares, so this is a learning curve for me, but signing up to the club has been simple and after just a couple of days I already have shares in three businesses in my ABC portfolio.
In my Angel Business Club review I will be looking at how it all works and reporting back periodically with my progress and profit/loss reports.
What is the Angel Business Club?
The Angel Business Club is a passive investment service that provides its members with the opportunity to invest in a variety of start-up businesses that have been researched by the club's expert angel investing team.
This is something that is not normally open to the general public as most start-ups are usually looking for large sums of money from big-time investors to kick start their business.
When I think about investing in start-up companies, I'm reminded of the Dragon's Den TV show, where a panel of venture capitalists look to invest their money in exchange for equity in businesses.
Being able to sit in one of those chairs seems a like a world away to most people, but The Angel Business Club makes it possible for the everyday person to get involved without having to do any of the leg work and without investing vast amounts of money.
There are definitely perks to investing in start-up companies, for example imagine having the opportunity to have bought shares in the likes of Google or Facebook when they were just starting out. Investors have made a fortune from being able to get involved with these businesses early on.
On the flipside, not all start-ups go on to be successful, which is why it is always important not to put all of your eggs in one basket.
This is where the Angel Business Club looks really interesting, as they buy shares in lots of start-up companies, not just one. Not all of them are going to work out, but there's the chance to make a really good return from the ones that make it.
So far members have seen an annual growth of somewhere between 40-70% on their portfolio, which is much higher than you would expect to see from most investment opportunities.
Angel Business Club Success Stories
- WideCells Group, a world leading Stem Cell Service provider, which listed on the London Stock Exchange in June 2016. Members that received shares in this investment saw the value double in price from 8p to 16p each.
- Path Investments, active in the Oil and Gas sector, listed on the London Stock Exchange in March 18 2017.
How does the Angel Business Club work?
Members of the club pay a monthly subscription fee, which starts at £80 per month for the base level and ranges all the way up to £897 per month at the highest level, depending on how much you are happy to invest.
I have opted to subscribe to the first membership level at £80 per month, which will be taken out of my investment portfolio fund.
After becoming a member, you start to receive shares, or “share entitlements allocations” to be precise, in different start-up businesses every week. As the businesses start to grow there's the chance to receive dividends from them, although it could take some time for this to happen.
The main way to make make money from the club is if a company you have shares in gets taken over by a big competitor. In this case, all shareholders would receive a payout or shares in the larger business. Either way it usually is a win-win situation and there are great profits to be made.
If a business chooses to raise money on a stock market to further accelerate growth, the value of the company often increases which again is another great thing for angel investors.
Members can choose to trade their shares with other members on the internal exchange, which is good if perhaps you think the value isn't going to increase in the short-term and perhaps another member wants to take a long-term view. There is no commission charged for using the internal exchange so it's a great way to buy and sell shares.
As I mentioned earlier, I have recently signed up to the Angel Business Club and I have already been allocated shares in three businesses within a couple of days. I have reserved £960 of my investment fund to pay for 12 months membership to the club, so this will be a long-term review.
I'm excited to see whether any of the budding businesses that I will be investing in end up being the next big thing. I will be back with an update once I have any notable news or profit/loss to report.