Women & Minority Entrepreneurs

Perhaps the most viable financing sources for women and minority entrepreneurs are angel networks-informal investment networks of wealthy individuals and families who invest in start-up businesses.

"Angel networks are replacing the role venture capital played 20 or 30 years ago," says Mary Bechmann, partner at Baccharis Capital, a venture capital firm in Menlo Park, California.

The growth of angel networks has made financing available to a wider spectrum of companies. "Angels have a different set of criteria than venture capitalists," says Bechmann. "You can [grow at] a slower pace and be more conservative."

To find angels, start with a solid business plan. Next, hire an accountant and a lawyer who are experienced in dealing with start-up companies and know the financial community.

There are no shortcuts to networking-but there's also no substitute for it. "Once you know one insider," says Bechmann, "you can get to others." And that's how you get financed.

This article was originally published in the January 1996 print edition of Entrepreneur with the headline: Women & Minority Entrepreneurs.