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Together the investors interviewed for Winning Angels have done over 1,000 deals. Their combined knowledge allows us to turn angel investing into a science. If you have business experience and capital you can now invest with a reasonable likelihood of success if you learn and follow the strategies and tactics set out in Winning Angels and do enough deals. Here are two examples of the type of information you will find in Winning Angels that will help lead to successful angel investing. |
"An
insightful and fact-filled primer on how to ferret out great
opportunities"
Richard
Kramlich, Angel in Apple Computer, and currently a Partner at VC firm
New Enterprise Associates
Although there are many ways to create deal flow, winning angels are more likely to do one of the 18 activities described here. Do these, or some combination thereof, and you will have more deal flow than you can handle. Winning Angels further provides: recommendations, time to execute, likely results and examples of each.
- Write one-pager
- Personal meetings with bankers, etc
- Participate in an Angel group
- Share quality deals
- Join an Angel / Entrepreneur matchmaker
- Reward your network
- Give an interview
- Give speeches, publish articles
- Teach Entrepreneurship /Angel course
- Write a book
- Make an investment (winner or loser)
- Hire best lawyer and/or accountant in town
- Co-invest with winning Angels
- Focus on your network
- Focus on 1-2 industries
- Build a network in 1 industry
- Act in a syndicate
- Turn away all but…
"This
book shows how many different styles there are that work"
Angel
investor CL
Silent Investor
Pure financial investor, will take no active interest in the company, except to sign papers and hope for returns.
Howard often takes the silent investor role. But he can easily jump into a reserve force role when he sees an opportunity to have an impact and when he has the time. In other cases he has joined up with teams or acted as a coach. He is not interested in being a controlling angel.Reserve Force
Ready, willing, and capable to help as requested by the entrepreneur, impact depends on relevant skills and contacts and also on being called at the right time.
Angel investor Andrew Blair and his partners often act as a reserve force. They maintain a ‘hotline’ for urgent access. For example, if an entrepreneur has a problem with the government bureaucrats and can’t sleep “…he can call through on the hotline and they will try to knock out the stressor for him”. David, through his company, Capitalyst, also takes a reserve force role, providing up-front strategic advice and practical training on raising capital from high-impact investors.Team Member (full or part-time)
Works in the company on particular projects or in a functional area. There is a risk of micro-managing the entrepreneur if the investor has a significant stake or represents a majority interest. Impact depends on relevant skills and contacts but also on the relationship with the entrepreneur (which is likely tested in this scenario). An angel, who takes on the role of a Team Member, will generally have a high to negative impact, depending on whether there is any power friction between the investor and the entrepreneur team.
As Jaap Blaak prefers true seed stage deals he often gets actively involved. In one investment he had decided the scientist was “definitely not a manager” and so he took on the CEO role until a full time replacement could be found.
Coach
Perhaps the highest impact investor who does not control the company. Although in some cases they will have control that they do not exercise. Meets with the entrepreneur regularly and provides support, advice, and any assistance as needed and requested by the entrepreneur. Considerable experience in angel investing is a must. However, even a new angel could have impact if they remember to act as a coach. Remember that coaches stay on the sidelines.
Betsy Atkins sometimes plays a coaching role. She is available for monthly board meetings and weekly telephone calls. “If there’s something hot cooking, like an IPO, we will talk many times a day,” she says. “ I’m there for them at all times as a supportive active investor.”
Controlling Investor
Investor who really becomes the entrepreneur by taking control (outright or through conventions) and manages the company. High impact.
Jeff Parker sometimes plays a controlling role where he invests the majority of the capital and gains voting control, control of the board, or control through the investment agreements (such as more equity if certain targets are not met).