Following the math in the original article, you can create a portfolio of investments as a VentureSouth member for $50,000 (10x $5,000 investments) to $100,000 (20x $5,000 investments). The minimum commitment to our previous sidecar index fund, the Palmetto Angel Fund, was $25,000; it invested in 18 companies.
In general, advocates of angel investing say your angel portfolio should be at most 5% of your investable assets – this is a risky asset class after all. $50k of investment translates to $1 million of investable assets – approximately the accredited investor definition.
So you don’t need millions of dollars to be an angel investor. The returns from angel investing are probably not going to change your overall portfolio return substantially (it’s hard for 5% of your portfolio to change its overall direction), but they could be a nice bonus that is not correlated with the rest of your portfolio.
And you don’t necessarily need to invest using “unused” cash. Many of our investors use a small proportion of their retirement accounts to fund their angel investments. If you just made this year’s IRA contribution and weren’t enthusiastic about more public equities at the “new normal” of 20x P/E, perhaps a self-directed IRA commitment to a VentureSouth sidecar fund might be an alternative this year?