6. Entrepreneurs gain Leverage
• Cheaper
• Incremental
• Incubators / Combinators
• More hit-driven
• Transparency
• Mostly Seed and Consumer
7.
8. A Bill of Rights
1. Quick decisions 6. No Control
2. Standardized Docs 7. Right to Sell
3. Allocate the round 8. Peer Relationships
4. Independent decisions 9. Specific Knowledge
5. Raise less; dilute less 10.Cash up Front
9.
10. Venture capital is a business and is open
to attack by “startups” with disruptive
new business models and technologies
11. Why Now?
• NASDAQ rebounded; but other asset
classes have a poor outlook
• Small exits are creating small angels
• Consumerization of everything
• Small M&A market still strong
• Incubators, AngelConf, AngelList
12. The New Financings
• Product built at the incubator level
• Continuous, not discrete rounds
• No fixed amounts, no closings, no leads
• Prices beginning to float
• No Board seats (no leads)
• Standardized terms
• Herd mentality (rational); oversubscriptions
• Unbundling of advice, control, money
13. “By its nature, the Internet undermined anyone whose
status depended on a privileged access to information”
- Michael Lewis
14. Wait and See?
• Could just wait for the Series B
• 10 startups that matter
• The ones with traction are obvious
• Used to be about capital, judgement,
dealflow
• Now about access
• “Stay hungry, stay foolish”
15. Moving Upstream
• Being an angel is about control, not $
• Hustle; seed programs
• Clear differentiation; specialize
• Give up need for control
• Productize yourself
• Less meeting; more tweeting
• Retreat to higher ground
16. Learning to Fly
• Be picky
• Join the herd
• Brand yourself
• Be humble
• Stick to standard terms
• Shun power
• Buy (not earn) your stock
17. “But I don't want to go among mad
people,” Alice remarked.
“Oh, you can't help that,' said the Cat:
“we're all mad here.
I'm mad. You're mad.”
- Alice in Wonderland
18. • Un-priced Rounds
• No vesting (bad for entrepreneurs too)
• Acquirers split founders / investors
• Some angels - full anti-dilution, control, tranches
• Doubling prices in a month
• Selling common stock to minority shareholders
20. Predictions
• More angels on their way
• Spectacular fraud will occur
• Entrepreneurs will exploit investors
• Some companies will skip VC altogether
• Super-angel bubble? Unknown
21. “There's a battle outside ragin'.
It'll soon shake your windows
And rattle your walls
For the times they are a-changin'.”
- Bob Dylan
