It is a long-term investment because fluctuations in the value of shares or shares are virtually non-existent and each change in capital must be negotiated. This type of investment involves finding a company that accepts outside investors and being able to make a good estimate of the company in which to invest with Angel Investment .
There is indeed no guarantee regarding the protection of the invested capital, but moreover, the recovery date of the one is not fixed in advance. For a refund to be possible, it is essential that there is a candidate for redemption. The exit options are the transfer of the shares to another investor, the purchase of the company by another company or its IPO.
ISF and IR tax exemption
Investing in an SME allows for tax deductions under the Madelin and TEPA laws. Those liable for income tax (IR) deduct 18% of sums invested in the capital of French and European SMEs. SMEs eligible for tax benefits must meet the following criteria:
- Achieve a turnover of 50 M $ maximum,
- Have less than 250 employees,
- At least 2 employees at the end of the first fiscal year,
- Have a registered office in a country of the European Union.
Deductible payments are capped at:
- $50,000 single person for a maximum tax reduction of $ 9,000,
- $100,000 married couples or couples with a common tax regime for a maximum tax reduction of $18,000.
To benefit from the tax deduction, the units must be kept for a minimum period of 5 years and the subscription must take place before December 31 of the current fiscal year. The ISF PME scheme allows income tax payers (ISF) to deduct 50% of the sums invested in the capital of French and European SMEs. Deductible payments are capped at $ 90,000 for a maximum tax reduction of $ 45,000.
Unlike the IR PME scheme, the TEPA law does not provide for maximum seniority for the company. To benefit from the tax deduction, the units must be kept for a minimum period of 5 years and the subscription must be effective before June 15, 2015 for assets greater than 2.57 million euros.
Partner to invest
Finding the right companies to invest in, keeping a constant watch on growth sectors, analyzing the business plans of the project holders is a complex task for a single person. This is why individuals wishing to invest in unlisted companies beyond their immediate circle are more and more numerous to join a network. A network of business angels is a legally formalized organization allowing the connection of potential investors and entrepreneurs with a general objective to make investments by business angels and to be the point of attraction of entrepreneurs in search of funding. The network services are accessible to all innovators with high growth potential.
Business angel networks are organized either:
- Geographically: their intervention scope is local, departmental, regional or national,
- Thematically: they are specialized in a specific sector of activity health, ICT, agro-food, environment, wood industry,
- Culturally: these are the alumni of major schools
Grouping together into a local, thematic or sectorial network allows Business Angels to better organize and share experiences, decisions and investments.