The Angel Fund Initiative Nigerian Society of Chemical Engineers Foundation (NSChEF) is aimed at enhancing the entrepreneurial capacity of chemical engineering graduates, consequently, advancing the economic output to the society. This is line with the mission of the Nigerian Society of Engineers (NSE) which is to provide quality service aimed at enhancing professional competence and development of its members at all times.
To provide startup funding for fresh graduates in Chemical Engineering who have bankable ideas and want to start a business or have existing businesses and require funding to run and scale the business.
This initiative was inspired to bridge the unemployment gap resulting from the alarming number of graduates who leave tertiary institutions each year in Nigeria with no prospect of gainful employment following their National Youth Service Corps.
The NSChEF Angel Fund Initiative is geared towards providing start-up capital for young chemical engineering graduates with bright ideas, as a way to foster entrepreneurship, create employment and advance the offering of the industry as a whole. This intervention seeks to provide a structured way of addressing this major gap. The angel fund based on its increasing impact serves as a strategic way to administer financial support for young chemical engineering graduates in Nigeria. This is to enable them refine their entrepreneurial skills in tune with current technological advancement to develop and produce unique products and services, become employers of labour, increasing the economic output to the society.
Angels Membership Model
The membership model is one where angels pay an annual membership subscription fee which gives them access to sit at pitch sessions that attracts high quality entrepreneurs with bankable ideas. The AFI currently has 15 Angels.
The Angel Membership Model has the following characteristics:
Opportunities & Deal flow Framework
The opportunities to fund and Deal Flow will be executed according to the framework below:
Sources of Funding
The funds will be sourced from select members of the Nigerian Society of Chemical Engineers, Patrons and Friends of the profession who commit to invest a certain amount annually and pay a membership fee based on proposed model above. Members of this team will be expected to make collective investments based on a pre-agreed set of assessment criteria.
To guide the submission and assessment of potential investment opportunities, the following framework serves as a guide in determining the application the NSChEF fund. Below is a brief description of the framework:
Monitoring and Evaluation
A committee is designated and charged with the responsibility of evaluating the investment. The dedicated Foundation Secretariat keeps records of all investments and maintains strict confidentiality of records. The secretariat will also be in charge of monitoring the investments and interacting with beneficiaries regularly; and prepare a periodic report to the angels on the performance of all investment portfolios.
An Angel investor (also called Business Angel) makes use of their personal disposable finance and makes their own decision about making the investment. The business angel would normally take shares in your business in return for providing equity finance. In so doing, they normally seek to not only provide your business with money to grow, but also bring their experience and knowledge to help your company achieve success. Angel Investors seek to have a return on their investment over a period of 3-8 years. Angels can invest on their own or with a syndicate. Angel investors then follow their deal either actively taking a role on the board or actively supporting the business, or may act passively as part of a group with a lead angel taking this role on their behalf.
Angel investing is equity finance. Angel Investment differs from Venture Capital, VC, finance which invests in businesses through managed Funds, raised with private or public money. The venture capitalist manager invests the money on behalf of the Fund which has to be profitable and make a return for the fund’s investors. Due to high costs of administration and the need to be very selective to ensure a return on the fund. VC funds are more risk averse and thus make fewer small investments in start and seed stage. This makes business angels more and more significant in funding new ventures by supplying smaller amounts of capital to companies that cannot be economically funded by the established venture capital market.
Business Angels make their own decisions about investments. They engage directly in meeting the entrepreneurs, often observing them pitch their business. Angels are also directly involved in the due diligence and investment process, and are signatories on the legal investment documentation. This can be done either on their own or with a syndicate. Angel investors follow their deal either actively taking a role on the board or actively supporting the business through mentorship, or may act passively as part of a group with a lead angel taking this role on their behalf.
Business Angels differ from venture capital firms not only in the size of their investment, but also in their approach. Angel investing is often called “patient capital” since angels are less concerned with rapid return and exit and are prepared to support the business through its path to growth and exit over a longer time scale.
In general, individual business angels will invest anywhere between ₦2 – ₦10 million in a single venture, depending on the business and the growth needs. But this can be lower and occasionally much larger sums according to the disposable wealth of the individual and opportunity identified. Also with an increasing trend towards angels investing in groups and syndicates, larger amounts of finance above ₦50 million can be raised by investors pooling their finance and also their business skills.
We are interested in entrepreneurs and Businesses who think creatively and apply smart innovation and technology to turn their ideas into unique products and services that are sustainable and solves real commercial problems.
Our areas of focus includes: