Leaders of the Core, a medical-tech industry cluster in Meridian, are rolling out the Treasure Valley Angel Fund, a potential source of money for young businesses throughout Idaho.

A number of investors have committed or signaled their interest, and the fund is looking for others, organizers say. An initial $750,000 must be raised before the fund can begin investing. Organizers hope to reach that benchmark within the next week or so.

“The infusion of private angel investment is an invaluable resource for new Idaho businesses — especially those with evolving technologies and products,” said Jeffery Sayer, director of the Idaho Department of Commerce.

Angel investors are wealthy people who invest a portion of their own money into businesses.

Earl Sullivan, chairman of the Core’s executive board, said Idaho lags behind other states when it comes to angel investments. North and South Dakota, each with much smaller populations than Idaho, have six angel funds between them, with more in the works.

The Boise Angel Fund, which raised about $1 million, has about $300,000 left but is focusing on bolstering its existing companies.

“The research is very clear that new companies are a large source of job growth, and if you want to create job growth, you have to create new companies,” said Kevin Learned, a counselor in the Idaho Small Business Development Center and member of the Boise Angel Fund. Learned also plans to be part of the Treasure Valley Angel Fund.

Idaho also lags in venture capital, experts say. Venture capitalists, unlike angels, make their living by investing in early-stage businesses.

Highway 12 Ventures in Boise, Idaho’s largest venture capital firm, is winding down its projects over the next few years and not making any new investments.

“Young companies need two things — money and mentorship — to help steer them through the critical early growth periods,” Sullivan said.

Angel funds are created when investors pool their money and experience to fund and mentor entrepreneurs and their business ideas. To protect the public from risk of loss, federal regulations require investors to have a net worth of $1 million beyond the value of their primary residences. Investors may not put in more than 10 percent of the net worth remaining after their homes, furnishings and automobiles are excluded.

“What angels bring is their background and their experience and their Rolodex and their scars,” Learned said.

The Treasure Valley fund is a limited liability company separate from the Core, a nonprofit coalition that seeks to support economic development in health care and research in Meridian and across Idaho. The Core seeks to attract angel, private equity, government and other funds to help startups and fast-growing businesses.

The Treasure Valley fund will differ from other Idaho angel funds in its ability to seek investors and tell the public what it is doing.

Groups that raise money for investments must register with the state and federal government, and are prohibited from general advertising, such as speaking at business clubs or to the news media, either to solicit investors or to discuss plans to create a fund. The new fund was organized under federal and state rules permitting exemptions to the ordinary limits on promotion.

“We’re anxious to track how they do and see if it’s a viable model for Idaho,” said Securities Bureau Chief Marilyn Chastain.

Sandra Forester: 377-6464