Angel Investment Group Partnership Provides Rare Experiences for Students

Duquesne entrepreneurship students can gain an unusual hands-on experience through a new partnership with a local investment network. It is one of a number of ways the Entrepreneurial Studies program is increasing the engagement and visibility of its students in the Pittsburgh startup ecosystem.

BlueTree Allied Angels, which has been operating since 2003, is the leading angel investor group in Pittsburgh. Angel investors, typically high-worth individuals, invest in startup or young companies. The 65 private members of BlueTree have made investments of more than $27 million in a 40 plus company portfolio. Think of the ABC Shark Tank show with less drama and a more deliberate evaluation and decision-making process.

As angel investors, they’re willing to put up with high risk for high reward by supporting very early-stage companies, said Dr. Dean McFarlin, dean of the Palumbo-Donahue School of Business. Because most are successful entrepreneurs or executives, they also provide advice and management support for entrepreneurs.

The business school’s partnership with the investment group provides a unique, cutting-edge opportunity for students to see both sides of the system at work: entrepreneurs presenting to potential investors, and investors checking into possible investments on the private equity end.

“We see this as support for development of future entrepreneurs in the Pittsburgh area,” said Catherine Mott, chief executive officer of BlueTree Allied Angels. “It is another way that we contribute to economic and workforce development in the region.”

For starters, 20 students in the entrepreneurial finance course taught by Dr. Jack Mason, director of the entrepreneurial studies program and a serial entrepreneur, are participating in screening the startups before investments are made. The process involves such steps as:

• Pre-screening meeting teleconferences
• Screening meetings at which entrepreneurs present their companies
• Investor meetings at which entrepreneurs again present and investors vote on whether to invest
• Due diligence review.

“Entrepreneurs have to understand how to attract outside investments,” McFarlin said.  “There’s no better experience than real, first-hand involvement and observation. They’re seeing real pitches and deliberating real investments, meeting with investors and understanding the system.

“It’s all real stakes. In entrepreneurship and entrepreneurial finances, seeing companies created is an eye-opening experience.”