Truth Angel Blog

Truth-Angel-Blog
What should we do
Entrepreneurs
1. Avoid believing "specialness" of angels as a category of investors
No "value difference" to F&F
2. Understand the true alternatives, such as banks and bootstrapping
3. Develop an accurate profile of angel investors
4. Understand what angels are looking for no need to be next Google
5. Have a realistic sense when one can get angel money
It's much later than one thinks (hopes)
6. Be aware that raising money as a process is typically haphazard
7. Understand what you can get out of angels
It's just money, actually
8. Not all angels are the same a small minority can provide more than just the money
Angels
1. Have realistic earning expectations
2. Ask yourself why you want to make angel investment
3. Have realistic expectations of what you will get in return
4. It's not difficult to become an angel investor
5. Remember the angel groups
6. Be selective and focus
F&F investors
Treat angels with less awe
Don't believe the added value
VC
Angel goals are not completely aligned with VC goals
Policy Makers
1. Remember that the angel market is small
2. Remember the differences WITHIN angel market
Remember that the majority is nonaccredited investors
3. Carefully assess the reasons to intervene
Tax credits do not work
Could lead to few startup overvaluation
Motivate to invest in angel groups
And help the nonaccredited investors
Market size
Angel investments = VC investments
Angle investments is 14% of all informal investments
3% of M&A market
Typical startup
No complete management team in place
Older entrepreneurs than in media
More educated
Often solo entrepreneurs
Often not even only startup, 100% focus on one company not needed
All variations
Sophistication
Naive
Knowledgeable
Role
Passive
Active
Investment stages
Early stage
Later stage
Investment size
Small
Large
Median 10,000 USD
Instrument
Debt
Equity
Risk level
High
Low
Typical investment target
Also service business
Typically not highgrowth business
Not only hightech
Later stage
Often homebased
Motivations to invest
To remain involved in the startup scene
To learn something new
To find a job
As a hobby
To make money
To give back to the community
Added value
No added value
There are few exceptions
It's just money
Motivations to invest
To remain involved in the startup scene
To learn something new
To find a job
As a hobby
To make money
To give back to the community
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