Keith F. Higgins is Director of the Division of Corporation Finance at the U.S. Securities and Exchange Commission. This post is based on Mr. Higgins’ remarks at the 2014 Angel Capital Association Summit; the full text is available here. The views expressed in this post are those of Mr. Higgins and do not necessarily reflect those of the Securities and Exchange Commission, the Commissioners, or the Staff.
The importance of small businesses in America is unquestionable—they are the foundation of today’s economy and are responsible for many of the new jobs created each year in the United States. And angel investors play a vital role in the development of small businesses by nurturing them at their earliest, most vulnerable stages when they may have little more than the next great idea. For early stage entrepreneurs, angels often are the only ones willing to listen to their business pitch, provide advice, and put in that crucial infusion of capital that is needed to transform an idea into a thriving new business. Yahoo, Google, Facebook, Home Depot—these are just some of the titans of today’s corporate America that, at an earlier stage of their development, were first backed by angel investors. [1] Equally impressive are some of the statistics about the impact of angel investing—by one estimate, in the first half of 2013 alone, angels invested approximately $9.7 billion in over 28,000 ventures, with over 111,000 new jobs created as a result of these investments. [2]