Angel Business Club Review: 12 Month Results Update

Angel Business Club Review

The Angel Business Club is a passive investment service which offers the opportunity to invest in start-up businesses.

The Club's professional investing team does all the hard work and research, so this looks like an ideal service for us to get involved with.

We're very much beginners when it comes to angel investing, so we were expecting a steep learning curve. However, signing up to the Club was simple and after just a couple of days, our ABC portfolio already had shares in three businesses.

The fact that this is a passive investment is very attractive. We're excited to find out whether we can set up our portfolio initially, then let it run and watch the money roll in. ABC has certainly had success in the past, as we'll cover shortly.

Our Angel Business Club review explains how it all works and contains a summary of our profit/loss report after being a member of the club for 12 months.


What is the Angel Business Club?

When we think about investing in start-up companies, we're 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 like a world away to most of us, but the Angel Business Club makes it possible for the everyday person to get involved without having to do any leg work and without investing vast amounts of money. 

Investing in start-up businesses is something that is not normally open to the general public. Most start-ups are usually looking for large sums of money from big-time investors to kick start their businesses.

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 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. Some of them are not going to work out, but there's the chance to make a really good return from the ones which 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 Angel Business Club work?

Members of the Club pay a monthly subscription fee. The base level is £80 and prices go up to as much as £897 per month at the highest level. It all depends on how much you are happy to invest.

We opted to subscribe to the first membership level at £80 per month and started to receive shares, or “share entitlements allocations” to be precise, in different start-up businesses each week.

The main way to make make money from the club is when a company you have shares in gets taken over by a large competitor. In this case, all shareholders receive either a payout or shares in the larger business.

If a business chooses to raise money on a stock market to further accelerate growth, the value of the company often increases. This is more great news for angel investors as the value of their portfolio rises.

As businesses grow, there's also a chance to receive dividends although it could take some time for this to happen. 

Members can choose to trade their shares with other members on the internal exchange. This can be a smart move if you think the value isn't going to increase in the short-term, while 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.


12 Month Results Update

After being a member of the Angel Business Club for 12 months, we have gained shares in nine start-up companies.

We have spent a total of €979.00 in membership fees and our shares are currently estimated to be worth €1,243.17, which is a profit of €264.17 and a 27% growth on our investment.

However, this estimation is the strike price value that ABC have set, so it doesn't mean that this is what we would actually be able to sell them for. There is the option of trading the shares in the Angel Business Club secondary market but it is really only what people are willing to pay for them, so it could be difficult to achieve anywhere near the strike price.

Equity Entitlements Summary

CompanyQuantityStrike Price ValuePurchase ValueCurrencyGrowth
Britannia's Gold Ltd72421.20421.20EUR0.0%
International Ambulances23558.7558.75GBP0.0%
MYCAB38201146.001146.00SEK0.0%
MYTOWN3820.9020.90GBP0.0%
Ridercam16175.6765.80GBP15.0%
Skinny Tonic Ltd174146.16145.76GBP0.3%
SmartTrade App Ltd419.1219.12GBP0.0%
TECS GROUP2514210.47129.19GBP62.9%
Total Environmental Solutions Ltd212106.00101.00GBP5.0%

As you can see, the value of our shares in four companies have increased so far but it could be a few years yet until there is an exit event where we can hopefully sell them for a profit.


Summary

It's exciting to see whether any of the budding businesses that we've invested in end up being the next big thing. The Angel Business club isn't a short-term investment and does require patience and willingness to hang in there for the long-term game.

We have paused our membership for now, but we will be keeping hold of our shares and will report back with an update when anything notable happens.


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