Looking for additional funding to launch or grow your business? If you have the experience, skills and passion, there are some potential sources of private equity capital available in New Mexico. Equity capital sources can be broadly placed into two categories: Angel investors and institutional equity investors. Determining which source to pursue is largely a function of three key factors: 1) industry focus, 2) business stage, and 3) amount of money you are raising.
Keep in mind that private and institutional investors back rapid-growth and scalable businesses in exchange for an equity position in the company. Companies must demonstrate high returns to their investors.
Angel Investors
An angel is an accredited investor who invests his or her own, personal capital in early-stage business ventures. Angels are often the bridge from the self-funded stage of the business to the point where a venture capitalist would be interested in investing. An increasing number of angel investors are organizing themselves into angel networks or angel groups.
The New Mexico Angels prefer seed and early-stage investments. They consider themselves generalists and will consider investing in a wide range of industries. Initially, they were focused on technology but they now consider non-technology ventures. Initial investment amount ranges from $100,000 to $500,000.
Institutional Equity Investors
Institutional equity investors, known as venture capitalists, are not listed here because they can be transitory. For example, when a fund is fully deployed, it transitions into maintenance mode in which the VC investors shift their focus from seeking new opportunities to maximizing the potential of the company that received its investment.
The New Mexico Finance Authority Venture Capital Program Fund was created by the New Mexico Legislature in 2022 to advance the economic development objectives of the state by making investments for start-up, expansion, product or market developments, recapitalization, or early-stage development. The New Mexico Legislature appropriated $35 million in 2022 and $15 million in 2023 to the NMFA Venture Capital program.
NMFA maintains a list of the venture private equity funds that it has invested in and updates the list when new funds are added.
Check the list and contact the funds if your venture meets fund guidelines.
For definitions of the various stages of business development, see the glossary on the Finance New Mexico website.