My friend, Bill Carleton, posted a very thoughtful blog on Crowdfunding and angel investing: http://www.geekwire.com/2012/angels-crowds
Bill has teed up some excellent questions. See my response.
While you should definitely read the entire post, here is brief excerpt:
Crowding out angels from startup financings?
March 3, 2012 at 1:52 pm by William Carleton
As early as next week, we may know …
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Dan: “Hi. I’m Dan and I’m and addict.”
AA Group: “Hi Dan”
Dan: “It’s been one month since I did my last Angel investment.”
AA Group: “Way to go Dan.”
Dan: “But I’m weak. I know that I’ve failed forty times in the last 6 years. I really need to make another Angel investment soon.”
AA Group: “Be strong, Dan”…
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I am a big fan of high-tech companies. People that know me (and my co-investors) know that I like companies that are “changing the world” or “creating new industries” through technology innovation. And they know that I believe that research universities spawn great technologies and deserve public support. Universities do a terrific and efficient job of educating students, organizing research …
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Many entrepreneurs, when they take outside money into their company, want to protect themselves. This is a perfectly reasonable thing to do.
The investors putting the first money into the deal also want some protection, especially when the founders own a vast majority of the overall stock and probably have a majority of the board seats.
One of the items …
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In my previous post, I noted that the AoA had a great year in 2010. (http://blog.drosenassoc.com/?p=61 or the full release http://drosenassoc.com/AoA%20results%202-23-11.pdf)
Typically, most angel groups or VCs see about 25-40% of their deals die in the first 4 years. (This is called the J curve, since the portfolio value goes negative for the first 3-5 years and gets …
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The Seattle Alliance of Angels had a wonderful 2010. To quote the headline: Alliance of Angels Invests Record-high $10.3 Million in 2010; Group hits new milestone with investment in 33 Northwest-based startups; surpasses previous investment record by more than $1 million.
I was quoted:
“Once again, our angels have set a new standard for investing in innovative, young companies,” said …
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I was the founding managing partner for Frazier Technology Ventures (http://www.fraziertechnology.com/), which unfortunately was founded in May 2000, possibly the worst time for starting a new venture fund. Up until last week, the fund’s performance was in the middle of the pack (and therefore did not come close to returning capital). This was a financial, professional, and personal …
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Last week, I was invited to attend and speak at the Quebec City Conference Public Policy Forum on Venture Capital and Innovation (http://www.quebeccityconference.com/eng/about/about-ppf.php ). It was a presage to the main conference on Innovation. The participants and speakers were all excellent, with the majority non-US, which gave the event a perspective not usually seen in similar events. While I …
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Not much surprises me these days, particularly during this mud-slinging political campaign season.
However, Marcelo Calbucci’s Tech Flash post (http://www.techflash.com/seattle/2010/10/have_we_killed_the_angel_investor.html) did. How my posts could be so misunderstood by someone I respect baffles me, especially when that misunderstanding is posted to a widely read blog.
My previous post on Angels forming LLCs for their investments IS entrepreneur friendly, …
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One of the questions I am asked by first-time startup CEOs: what is an appropriate level of communication with my investors?
This is both a difficult and profound question. It is simple to say that more is better than less. It is also simple to say that any good investor would rather have you spend your time executing your plan …
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