Editor’s note: VentureWatch is a regular feature on Tuesdays.

ATLANTA … The Atlanta Technology Angels (ATA) are a bit different than angel funds such as the Triangle Investment Group (TIG) or the Charlotte Angel Partners in North Carolina, says its executive director, Knox Massey.

“We’re not a fund,” explains Massey, a graduate of the University of North Carolina at Chapel Hill and fulltime paid manager of ATA. “We’re composed of 45 individuals who fund a company individually, but wrap it up under the ATA name.”

The ATA Web site provides a bit of background about the term “Angel investor.”

“The term “angel” financing finds it origins from Broadway (theatre),” it says.

“Historically, the moniker referred to wealthy individuals who would swoop in at the last minute and save a production by providing money. In today’s environment, angel investors are wealthy and/or experienced business people who seek to provide start-up businesses with financing in exchange for an equity stake in the company.”

It also points out that angel investors typically provide funding after an entrepreneur’s personal funds (credit cards, savings, family) have been exhausted, but before true venture capital funding can be raised.

An angel investor typically is more interested in taking an active role in the new company than venture capitalists and other professional investors, not to run the company, but to provide advice based on their experience, it notes.

Very active

ATA is very active, Massey says, placing between $2 million and $4 million in Atlanta area startups annually. “We try to invest between $250,000 and $750,000 and are probably geared toward an average of $500,000 in this market,” he says.

He adds that ATA has gone as high as $1 million but generally does not invest less than $250,000.

Massey, who has family in North Carolina, says it will be at least a year before ATA looks outside the Atlanta market, where he notes “there’s plenty of opportunities,” but “at some point we’ll start looking southeasterly.”

ATA works closely with Georgia Tech Advanced Technology Development Center (TDC), which incubates 30 to 35 technology companies in its state-funded incubator located in midtown Atlanta. The ATA offices are a floor below the incubator at the TDC.

The ATA group has invested in 23 Atlanta technology companies between 1999 and 2003, generally along with a syndicate of other venture firms.

Massey says ATA is currently monitoring 15 portfolio companies funded over the last five years. “Some others sold or went out of business,” he notes.

Moonbuzz merger

Its portfolio includes Auctionworks, a competitor to Triangle-based Channel Advisor, Connecture, which sells Web-based sales and services to the insurance industry, and MediZeus, which is using artificial intelligence and the Internet to improve disease detection and Qcept Technologies, which is commercializing patented sensors for inspecting high tech devices during manufacture.

Massey points out that Vocalocity, which sells advanced automated telephone services such as speech recognition software, recently closed a large round led by California venture firm Sutter Hill. Massey points out its always impressive when a regional company pulls in California venture money.

Another of ATA’s portfolio companies, Trade Ups, merged with Charlotte-based Moonbuzz to form Market Velocity Inc. in 2002, now headquartered in Charlotte with an office in Atlanta.

Market Velocity is headed by well-known Charlotte entrepreneur Patrick Vaughn. The Trade Ups software helps Fortune 500 companies leverage the value of current equipment to trade up.

ATA holds monthly meetings and includes a link for Atlanta-based technology startups to submit a business plan on its Web site.

Atlanta Technology Angels: www.angelatlanta.com/