Justifying AngesQuebec’s $750k subsidy

When AngesQuebec announced $750k of funding from the Québec government, I asked what the justification was for giving money to already wealthy investors.

Austin Hill is one of the network’s members, as well as one of Standout Jobs’ 3 founders. I pinged him, teasing him about getting government financing. He argued that while he’s generally opposed to the idea of subsidies, it makes sense in this specific case. In our discussion, a few facts came out that changed my mind about the project:

-$750,000 is over 3 years, after which the network should be self-sustaining
-AngesQuebec aims to have a network of 200 angels
-Over the next 5 years, $50 million should be invested in 120 companies, creating 800 jobs
-Other angel networks have gone bankrupt trying to bootstrap from member fees.

AngesQuebec is a non-profit, trying to build a public infrastructure good - something markets tend to fail dismally on. They are currently all volunteer run, and seeking their first paid staff. Hopefully this hire can improve communications and start the process of recruiting angels in order to grow to a sustainable size.