SlideShare a Scribd company logo
1 of 28
Download to read offline
“Show Me the $$$$!”…Session 3: Angels!
Insiders guide to Angels and Angel Investment

General Assembly / RosePaul Investments Event

Tom Wisniewski
RosePaul Investments

Tuesday November 19, 2013
Agenda

I. Kick-off and Introductions
II. Intro to Angel Capital
III. Investor Profile and Discussion
•

BREAK: Networking and Beverages

IV. More on Angel Investors
V. Best Practices:
•

WRAP-UP: Networking and Beverages

1
confidential
Seminar Rationale:
Why are you here?
 Interested in finding Angels….

• Want advice and $’s to help my start-up
 Interested in investing as an Angel….
• Want advice on how to get started and do it well
 Curious what the hype on Angels is all about
The Challenge…
 “Lots of noise, lots of conflicting descriptions and

advice”.
 “Angels difficult to find”
 “Angels challenging to engage …..and work with.”
 Most Angel investments fail: tough on investors and
start-ups
…..”I have a lot of questions”
2
confidential
However, there is a better way.

So….. what helps?
 Understand what Angel Capital is (and is not)

 Understand who (and what) Angel Investors are
 Understand the Angel Investment process
…….learn some best practices on Angel Investments from
some insiders and your fellow colleagues.

3
confidential
Tom Wisniewski: My background


Born in NYC; grew-up in Montclair, NJ



Physics and Philosophy major undergrad
(Clark University); MBA at Tuck School
(Dartmouth)




1st Job: Programmer at Morgan Stanley then
moved to Investment Banking
After B-school: joined a start-up management consulting firm Mitchell Madison
Group; focus on Strategy/Operations/IT for financial services, tech, outsourcing,
private equity/VC clients (1993 to 2000)



Walker Digital: helped set-up and run an early “internet incubator” (2000)



Independent Advisor / Turn-arounds: Advised VC and PE Firms on portfolio
company strategy and new investments; joined the management team of two
companies



Currently:
• Early stage investor and advisor to start-ups
• Investor and advisor to VC and PE funds
• Member and director at New York Angels

confidential
What would I like you to walk away with?

 Better understanding of Angels and Angel Investing.
 A set of specific insights that will *change* your approach.

 A “to-do” list: starting point(s), actions, things to try.
 A set of recommended resources to consult and learn more

from.
 A few new relationships with others in the NYC start-

up/fundraising ecosystem: fellow entrepreneurs, investors, etc.
 Answers to specific questions about pitching that you might
have.

5
confidential
So….what questions do you have about Angels and Angel
Investing?

 xxx

6
confidential
II. Intro to Angel Capital

7
confidential
Angel Capital: How it Fits in
$100M
IPO

Strategic Partners
$10M

Venture Capital

$1M

Banks
Angel Groups

SBIR/STTR Grants
Grants
$100K
Friends, Family
& Fools

Source:
Tom Stephenson, Verge

Idea

Plan

Angel Investors
Prototype

Beta

Sales

Profitability
8

confidential
Early

Late

Deal Volume and Stage: VC’s vs. Angels

Venture Capital
Mostly later stage
3,400 deals
$0.5-1.0B per
Year
Angel Capital
49,000 deals
Mostly early-stage
$20B per Year
9
confidential
What does Angel Capital look like?
Friends and
Family
(& Bootstrapping)
• $10’s of K
• Concepts? Plan
only?
• Not too many hard
questions..

• No legal ?
• Investing in YOU.

• Know YOU already:
Trust YOU.

 Round Size: $100’s of K, up to $1M
 Individual Angels Invest: $10K – 100K
• Sweet spot: $25K to 50K

 Valuation: Pre-Money valuations of $1-5M generally
 Requirements:

• B-Plan or “B-plan questions” answered
• Key founders in place (tech and bus), full-time
• Some product/ prototype done
• Some market validation / traction: piloting?
Paying? Customers

• Legal structure and documents in place
• Roadmap and plan for: Product, Market
Expansion, Breakeven? Next Round of Financing?

10
confidential
III. Investor Profile and Discussion
 Drew Arlo, Entrepreneur, investor and fellow New
York Angel

11
confidential
IV. More on Angel Investors

12
confidential
Who are these “Angels”? What do they look like?
 Experienced, successful entrepreneurs: frequently multiple exits
• Some from “tech-start-ups”, some from other businesses

 Successful “corporate” business people: CEO or CxO-types
 Older: most are in the 40-60 age group.
• But there are also notable angels in their 20’s and 30’s e.g. newly minted
start-up millionaires
 3 – 10+ Angel Investments

 ~10% of investible capital in Angel Investments
 Differ *widely* in: Industry/Functional Experience, Investment Experience,
Interests, Target Sectors/Stage, Investment $, Risk Tolerance, personal
do’s/don’ts and hot buttons.
 Lists? Not many. All are partial. AngelList? Gust? Other?
 VC’s (vs. Angels): full-time job, invest other peoples $’s. Lifecycle: Raise $’s,
Find/Evaluate, Invest, Manage Portfolio. Need big exits to make economics
work
13
confidential
Motivations: Why do they Angel Invest?
 Passion. Have some strong affinity and interest in the industry,
technology, business or entrepreneurs

 Involvement. Have the time. Want to stay engaged and involved.
 Giving Back. Have done well, now want to give back help fellow
entrepreneurs. Support a cause or social mission.
 Next Venture. Have exited. Looking for the next company to join, or
next big idea. Serial entrepreneur
 Go Pro. Have been an Entrepreneur. Looking to be a VC.
 Financial Returns. Have exited and made a fortune. Want to invest
and make more.

14
confidential
How do Angels add value?
 Feedback and Advice. On the business, on the pitch, on other

investors.
 Contacts. Introductions to customers, partners, team members,
investors, and …..other advisors.
 Experience. The wisdom of successes, and failures. Serial
entrepreneurs. Other investments.
 Capital….Duh!. Important, but....

…..and NOT (?): the common complaints.
 Not Full-Time. Not a job.

 Takes too long.

 Ask a lot of questions.

 Can’t / don’t follow-on invest.

 “Like herding cats”.

 Quality varies.
15
confidential
Angel Groups (and Angels): How do they differ?
 Member Profile: What does the “typical” member look like? What industries,
sectors, companies do they come from?
 Sector Focus. What types of companies are they investing in?
• Internet, software (vs. Hardware vs. Pharma / Bio-tech vs. Clean/Green-tech)
• B2C vs. B2B, Saas, Cloud-based, Content-based
• How does their Portfolio compare to their stated strategy?
• What is their “sweet spot”? Vs. their “also do”?
 Stage. What is the target “stage” for prospective investments? What completed
milestones and characteristics are they looking to see?
• Revenues vs. Pre-Revenue? Product/Tech development? MVP complete?
• Customer/market validation? Anchor accounts? User levels?

 Valuations/ Investment Size: Pre-Money valuation range and size initial
investment
• “We typically invest $200 – 500K at valuations in the $1-3 Million level.”
 Group Structure / Investment Decisions. How is the Angel Group structured?
Most importantly, how are investment decisions made? Who makes them?
16
confidential
Individual Investor Profile: Tom Wisniewski


Direct “Angel” Investor in Companies
• $25K-250K investments; Typical valuations: $1-5 Million,
• Typical Stage: at least some “product” done, some customer/sales traction
• Sector focus: Opportunistic generally within internet/software space;
- fair amount of Saas B2B, and consumer “marketplace” models, ecommerce enablers.
- NOT (or not much?): hardware, heathcare/ pharma, cleantech
• NYC based: 50% investments in NYC area companies; total of ~80% NE overall (e.g
Boston, DC), 20% West Coast.
• Examples:
- Sociocast (social/behavioral big data analytics)
- LiveLook (Saas, live collaboration sales/service platform)
- Anvato (Ad insertion to live video streaming via proprietary machine vision)
- Moveline (Uber for the moving industry)
- Bizodo (Saas, paperwork automation; “Adobe 2.0” internet document sharing)
- Movio (Digital “RedBox”; content delivery via “last 100 ft” of wifi internet)
- HeTexted (Relationship advice forum generating content, media opportunities)
- Wanderu (Kayak for ground transportation)
- DealFlicks (a “Priceline” or “Hotel.com” for movie theater tickets)
- iCharts (tool that enables engaging, sharable, embedible chart content)



Investor in Funds
• In addition to direct investments in start-ups, invest in VC and PE funds.
• Examples:
- Social Starts (Seed fund for start-ups leveraging the Social Web)
- Brooklyn Bridge Ventures (Charlie O’Donnell’s fund)
- Entrepreneurs Roundtable Accelerator (ERA Fund)
- Greycroft Partners (Venture Fund)
17
confidential
NY Angels Profile
www.newyorkangels.com



Member Profile: ~100 investor/members; several early-stage funds; Member
backgrounds are generally representative of the tech / entrepreneurs / industries in NYC:
software, e-commerce, ad-tech, finance, media



Sector Focus: Internet, e-commerce, new-media, software; B2C and B2B. Mostly NYC
Area.



Stage. Mostly early stage (with some customers/revs), some pre-revenue



Valuations/ Investment Size: NYA pre-money valuations tend to range from $1M – 4M;
investments tend to range from $250K to $1M+;
• For larger rounds, NYA often leads the deal and helps find the rest of the capital by
sharing/syndicating the deal with other Angel Groups



Group Structure / Investment Decisions. NYA core structure is as a group of individual
investors. Individual investors “opt in” to deals and make their own investment decisions.
• Typical member invests $25-50K in a deal.
• In addition to the core “opt-in” model, NYA has just closed a small seed fund that will
operate in parallel (using a “democratic model” for investment decisions)



History/Background. NYA has invested $45M+ in 70+ companies.
• We are very active in the NYC entrepreneurial / early-stage ecosystem
18
confidential
New York Angels Process: A Monthly Cycle
1.

Proposals Reviewed Online (via Gust): 50 – 100 monthly
•
Sources:
•
NYA website/Gust (“cold call”: low prob of quality, and success)
•
Syndicated deal from other group/investor (warm intro: better quality, better
success)
•
Referral from NYA member (warmer intro: even better quality/success)

2.

In Person NYA Screening: ~15 companies monthly
•
Around 15 of the 100 are selected to present at an in person pitch/screening session
(1st Wed of the month)
•
Companies have 10 min to pitch, 5 Q&A (5 minute investor discussion)
•
Usually ~40 NYA members attend

3.

Discovery / Follow-up: 1-3 new companies enter monthly (3-6 in-process total)
•
Of the 15, 1-3 companies garner enough investor interest to move forward in some
fashion
•
If there is sufficient interest from a core group of investors, and an investor willing to
“lead”, then the core NYA process moves forward with follow-up “Discovery”
meeting(s) aka deep dives, due diligence.
•
In some cases individual investors want to follow-up and explore the company
further independently

4.

Investment Breakfast: 1-3? companies monthly
•
Those Companies that get to the term-sheet stage with several committed NYA
investors, are brought back to present to the NYA Group at the Breakfast
•
NYA Investment Breakfast meetings: 20 minute presentation + Q&A, 40-60 NYA
members attending

5.

Final Due Diligence, Legal Docs, Closing.

confidential
III. Best Practices

20
confidential
Some Best Practices for Angel Investors
 Learn to Invest. Smarter you are, the better you invest. Learn from other
Angels, VC’s, entrepreneurs, all the online opinions/resources.
• Shooting from the hip, almost never works.

• “Its like unprotected sex; fun while you do it, but afterward….” - Linda Holiday
(Investor, Entrepreneur)
 Know the Investment. Invest in things you have some “insider knowledge” of.
• Leverage the talents and experience of other investors and experts.
 Build a Portfolio. Angel investing is very risky, need to diversify across pool of
investments
• Typical “VC” Outcomes: Out of 10 investments made:

- 3 Fail, return no money
- 3-4 “Do OK”, provide a modest return, or return “most” of investment
- 3 “Succeed and Exit”, 5-10x or more returns make up for the rest. Often
it’s the “One”: the 100x that drives the entire return
• Need 10 – 12 investments; more better.

21
confidential
Some Best Practices for Angel Investors
 Long-Term Commitment. Plan ahead; average hold-time of Angel Investment
is 7+ years.
• Reserve capital for follow-on rounds,
• Reserve “patience” for all the speed bumps, pivots and crashes
 Investment Structure Matters. [ GREAT COMPANY! ] + [….poor legal
structure] = [ Little/No returns and Misery ]

• Need to understand the key “terms”: term sheets, debt vs. equity
• But too much legal = counter productive, useless?....
 Valuation Matters. [ GREAT COMPANY! ] + […wrong valuation] = [ Followon problems, and Little/No returns ]
• Most “good” exits are in the $10’s of Millions, a very few >$100M;
• Repeat after me: “THERE ARE NO BILLION DOLLAR EXITS”

22
confidential
A “Good” Pitch Looks Like:

What one investor
looks for…
My (TW) Short List of
What is Most Important
1)
2)
3)
4)

Market Opportunity
Product
Traction
Team

Adapted from “10 Slides to an Awesome
Pitch” by Dave McClure, 500 Start-Ups
1. Elevator Pitch
2. The Problem
3. Your Solution (Demo Here!)
4. Market Size
5. Business Model ($)
6. Proprietary Tech
7. Competition
8. Marketing Plan
9. Team / Hires
10. Money / Milestones
TW: + Evidence of Traction!!!! Market Fit!!!!!

http://www.slideshare.net/dmc500h
ats/how-to-pitch-a-vc-sept-2010
23
confidential
Key Success Factors and Advice
for attracting Angel Investment
 Pitch, Get Feedback, Revise. Repeat. No venture idea was built in a
vacuum. The ONLY way to develop business ideas is to share them, solicit
feedback, make adjustments, develop/refine/add and…..DO IT AGAIN!
• Many ventures fail to gain investor attention because there are too many gaps
(perceived and real).
 Find Good Advisors. To get good, detailed feedback and input you need to be
talking to right people, with the right experiences: Experienced entrepreneurs
and investors, prospective clients and partners.
• “Look for advisors. Find investors.”
• How? Networking, networking, networking….
 Communication is Paramount. Potential investors (or potential employees,
customers, etc.) usually start out knowing nothing about you or you venture.
Getting someone up to speed: a challenge. Getting someone to write a check:
a big challenge. At the core is effective communication:
• Written: Business Plan, “One Pager”, e-mails, pitch decks
• In Person: Elevator Pitch, stand-up pitch presentation, video
• ….just as importantly: formally developing these pitches/plans will
improve/refine your actual business (its not just about telling your story to
others)
24
confidential
Key Success Factors and Advice….continued
 Find Investors that Fit. As a general rule, people invest in things that they
understand and have experience with; find Angels that come from industries,
sectors, etc. that are same/similar to your venture and the customer markets it
serves.
• If I have never invested in Caribbean real estate, oil wells….or
communication hardware, it is very unlikely that I will do it with you.
• For Angel Groups: use online bio’s / LinkedIn to identify likely “good fit”
Angels
 Find “Lead” Investor(s). Its critical to get one or more investors on board
who can take the lead in driving the investment process: due diligence, term
sheet, investor commitments, closing documents/process
• Investors trust…..other investors. Their interests are aligned. Lead
investors help attract additional “followers”. With Angel Groups: use available
bios / LinkedIn to
 Understand (and Manage) the Process. You are more likely to succeed if you
really understand what’s happening (or should be happening) For each step
(e.g. investor search, screening, presentation, due diligence, term sheets, etc.):
• What is happening or needs to?
• Why? What’s the rationale?
• Who is doing what? How do perspectives and motivations differ?
• ……now, what can I do to make it work for me?
25
confidential
Key Success Factors and Advice….continued

 Valuation (and Key Terms). Be realistic. Be Flexible. Realize this is a
professional (not personal) discussion ; there will be back and forth. Ultimately
the “market” sets the price/terms.
• There is more to investment terms than valuation….Important to understand.
 Timing. Am I ready for Angel Investment?......A few probing questions:
• Have you covered the key success factors mentioned here? Do you have a
compiling business opportunity with huge growth potential?
• Do you really need the money? Now? The more that you can accomplish on
your own, the more compelling your case (and valuation) will be…..
• Are you ready to work for a someone else? e.g. the investors, the board of
directors
• Fund raising is “brain damage”. It wastes valuable time that could be spent
growing the business. Avoid it, minimize it, delay it if you can.

26
confidential
Thanks!
Thomas Wisniewski
Contact Info
Email: thomas@rosepaul.com
LinkedIn: http://www.linkedin.com/in/thomaswis
Twitter: @thomaswis

This presentation: http://www.slideshare.net/Thomaswis/
New York Angels www.newyorkangels.com

New York Angels Educational Meetup: http://www.meetup.com/NY-Angels/

27
confidential

More Related Content

What's hot

SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...
SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...
SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...Dave McClure
 
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)Paul Singh
 
Techstars Patriot Boot Camp Fundraising Preso
Techstars Patriot Boot Camp Fundraising PresoTechstars Patriot Boot Camp Fundraising Preso
Techstars Patriot Boot Camp Fundraising PresoShai Goldman
 
Techstars Patriot Boot Camp 2015
Techstars Patriot Boot Camp 2015Techstars Patriot Boot Camp 2015
Techstars Patriot Boot Camp 2015Shai Goldman
 
Skip the J-Curve: An Intro to Venture Capital Secondary
Skip the J-Curve: An Intro to Venture Capital SecondarySkip the J-Curve: An Intro to Venture Capital Secondary
Skip the J-Curve: An Intro to Venture Capital SecondaryDave McClure
 
Corporate VC Innovation: Strategies That Don't Suck
Corporate VC Innovation: Strategies That Don't SuckCorporate VC Innovation: Strategies That Don't Suck
Corporate VC Innovation: Strategies That Don't SuckDave McClure
 
Building #500STRONG
Building #500STRONGBuilding #500STRONG
Building #500STRONGDave McClure
 
Startup Organizer Summit (Rio, 2013)
Startup Organizer Summit (Rio, 2013)Startup Organizer Summit (Rio, 2013)
Startup Organizer Summit (Rio, 2013)Dave McClure
 
When & How to Raise Venture Capital
When & How to Raise Venture CapitalWhen & How to Raise Venture Capital
When & How to Raise Venture CapitalNew York University
 
Women Helping Women in Entrepreneurship at MassChallenge
Women Helping Women in Entrepreneurship at MassChallengeWomen Helping Women in Entrepreneurship at MassChallenge
Women Helping Women in Entrepreneurship at MassChallengeThe Capital Network
 
Raising a Seed Round from Lerer Ventures
Raising a Seed Round from Lerer VenturesRaising a Seed Round from Lerer Ventures
Raising a Seed Round from Lerer VenturesSteve Schlafman
 
Building Startup Ecosytems & Investing in Tech Startups
Building Startup Ecosytems & Investing in Tech StartupsBuilding Startup Ecosytems & Investing in Tech Startups
Building Startup Ecosytems & Investing in Tech StartupsDave McClure
 
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)Dave McClure
 
Hack Osaka: Innovation Strategies for Regional Startup Ecosystems
Hack Osaka: Innovation Strategies for Regional Startup EcosystemsHack Osaka: Innovation Strategies for Regional Startup Ecosystems
Hack Osaka: Innovation Strategies for Regional Startup EcosystemsDave McClure
 
Building Startup Ecosystems (Istanbul, Sept 2014)
Building Startup Ecosystems (Istanbul, Sept 2014)Building Startup Ecosystems (Istanbul, Sept 2014)
Building Startup Ecosystems (Istanbul, Sept 2014)Dave McClure
 
RRE Ventures Raising Seed Capital
RRE Ventures   Raising Seed CapitalRRE Ventures   Raising Seed Capital
RRE Ventures Raising Seed CapitalVocatio
 

What's hot (20)

SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...
SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...
SVMN October 2007 Meeting - Calvert Foundation & eBay Microplace (Shari Beren...
 
Guide to nyc techv3
Guide to nyc techv3Guide to nyc techv3
Guide to nyc techv3
 
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)
Moneyball: A Quantitative Approach to Angel Investing (DC - Sept 2012)
 
Techstars Patriot Boot Camp Fundraising Preso
Techstars Patriot Boot Camp Fundraising PresoTechstars Patriot Boot Camp Fundraising Preso
Techstars Patriot Boot Camp Fundraising Preso
 
Techstars Patriot Boot Camp 2015
Techstars Patriot Boot Camp 2015Techstars Patriot Boot Camp 2015
Techstars Patriot Boot Camp 2015
 
Skip the J-Curve: An Intro to Venture Capital Secondary
Skip the J-Curve: An Intro to Venture Capital SecondarySkip the J-Curve: An Intro to Venture Capital Secondary
Skip the J-Curve: An Intro to Venture Capital Secondary
 
Corporate VC Innovation: Strategies That Don't Suck
Corporate VC Innovation: Strategies That Don't SuckCorporate VC Innovation: Strategies That Don't Suck
Corporate VC Innovation: Strategies That Don't Suck
 
Building #500STRONG
Building #500STRONGBuilding #500STRONG
Building #500STRONG
 
Startup Organizer Summit (Rio, 2013)
Startup Organizer Summit (Rio, 2013)Startup Organizer Summit (Rio, 2013)
Startup Organizer Summit (Rio, 2013)
 
When & How to Raise Venture Capital
When & How to Raise Venture CapitalWhen & How to Raise Venture Capital
When & How to Raise Venture Capital
 
Women Helping Women in Entrepreneurship at MassChallenge
Women Helping Women in Entrepreneurship at MassChallengeWomen Helping Women in Entrepreneurship at MassChallenge
Women Helping Women in Entrepreneurship at MassChallenge
 
Raising a Seed Round from Lerer Ventures
Raising a Seed Round from Lerer VenturesRaising a Seed Round from Lerer Ventures
Raising a Seed Round from Lerer Ventures
 
C4Q
C4QC4Q
C4Q
 
2014 A Start-up Story: Mike Kyriacou
2014 A Start-up Story: Mike Kyriacou2014 A Start-up Story: Mike Kyriacou
2014 A Start-up Story: Mike Kyriacou
 
The Helpful VC
The Helpful VC The Helpful VC
The Helpful VC
 
Building Startup Ecosytems & Investing in Tech Startups
Building Startup Ecosytems & Investing in Tech StartupsBuilding Startup Ecosytems & Investing in Tech Startups
Building Startup Ecosytems & Investing in Tech Startups
 
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)
Farming Unicorns: Building Startup & Investor Ecosystems (Dublin, June 2016)
 
Hack Osaka: Innovation Strategies for Regional Startup Ecosystems
Hack Osaka: Innovation Strategies for Regional Startup EcosystemsHack Osaka: Innovation Strategies for Regional Startup Ecosystems
Hack Osaka: Innovation Strategies for Regional Startup Ecosystems
 
Building Startup Ecosystems (Istanbul, Sept 2014)
Building Startup Ecosystems (Istanbul, Sept 2014)Building Startup Ecosystems (Istanbul, Sept 2014)
Building Startup Ecosystems (Istanbul, Sept 2014)
 
RRE Ventures Raising Seed Capital
RRE Ventures   Raising Seed CapitalRRE Ventures   Raising Seed Capital
RRE Ventures Raising Seed Capital
 

Similar to Show Me the Money: Angel Investors and Angel Fundraising

Getting Your Venture "Game Ready" for Funding
Getting Your Venture "Game Ready" for FundingGetting Your Venture "Game Ready" for Funding
Getting Your Venture "Game Ready" for FundingAndrew Tulchin
 
Angel investing 101: An Introduction to Angel Investing Aug 2019 SS
Angel investing 101: An Introduction to Angel Investing Aug 2019 SSAngel investing 101: An Introduction to Angel Investing Aug 2019 SS
Angel investing 101: An Introduction to Angel Investing Aug 2019 SSElaine Werffeli
 
Lakeshore arch angels presentation 04 2013_ali
Lakeshore arch angels presentation 04 2013_aliLakeshore arch angels presentation 04 2013_ali
Lakeshore arch angels presentation 04 2013_aliAli Jafri
 
SAC Learning Series Angel Investing 101
SAC Learning Series Angel Investing 101 SAC Learning Series Angel Investing 101
SAC Learning Series Angel Investing 101 Elaine Werffeli
 
7 Tips to Get Angel Investors for Startup Business
7 Tips to Get Angel Investors for Startup Business7 Tips to Get Angel Investors for Startup Business
7 Tips to Get Angel Investors for Startup Businessstartupsinvestorspla
 
Raising Capital from Life Science Investors
Raising Capital from Life Science Investors Raising Capital from Life Science Investors
Raising Capital from Life Science Investors SecureDocs
 
Funding basics - From Boots to Wings
Funding basics - From Boots to WingsFunding basics - From Boots to Wings
Funding basics - From Boots to WingsIoT613
 
MassChallenge 2011 Bootcamp Day 5: Finance
MassChallenge 2011 Bootcamp Day 5: FinanceMassChallenge 2011 Bootcamp Day 5: Finance
MassChallenge 2011 Bootcamp Day 5: FinanceBrendan O'Neil
 
MassChallenge Bootcamp
MassChallenge Bootcamp MassChallenge Bootcamp
MassChallenge Bootcamp Brendan O'Neil
 
MassChallenge Bootcamp Day 5: Finance
MassChallenge Bootcamp Day 5: FinanceMassChallenge Bootcamp Day 5: Finance
MassChallenge Bootcamp Day 5: FinanceBrendan O'Neil
 
Insider's Guide to Raising Early-Stage Capital
Insider's Guide to Raising Early-Stage CapitalInsider's Guide to Raising Early-Stage Capital
Insider's Guide to Raising Early-Stage CapitalNnamdi Okike
 
Fundraising Strategies – help investors find you
Fundraising Strategies – help investors find youFundraising Strategies – help investors find you
Fundraising Strategies – help investors find youKirill Mazur
 
11.29 TCN Boston Funding Options Overview
11.29 TCN Boston Funding Options Overview11.29 TCN Boston Funding Options Overview
11.29 TCN Boston Funding Options OverviewThe Capital Network
 
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...Know your Angels: What Entrepreneurs need to know about Angel Investors befor...
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...Elaine Werffeli
 
Startup Istanbul 2017 - Asra Nadeem - Angel Investing Basics
Startup Istanbul 2017 - Asra Nadeem - Angel Investing BasicsStartup Istanbul 2017 - Asra Nadeem - Angel Investing Basics
Startup Istanbul 2017 - Asra Nadeem - Angel Investing BasicsStartup Istanbul
 
Angel Investor Groups | Startups.co
Angel Investor Groups | Startups.coAngel Investor Groups | Startups.co
Angel Investor Groups | Startups.coErik Sullivan
 
Early Stage Fundraising
Early Stage FundraisingEarly Stage Fundraising
Early Stage Fundraisingguestf02bec305
 
Venture capital equity funding explained - Paula Mariwala, Seed Fund
Venture capital   equity funding explained - Paula Mariwala, Seed FundVenture capital   equity funding explained - Paula Mariwala, Seed Fund
Venture capital equity funding explained - Paula Mariwala, Seed Fundtiemumbai
 

Similar to Show Me the Money: Angel Investors and Angel Fundraising (20)

Getting Your Venture "Game Ready" for Funding
Getting Your Venture "Game Ready" for FundingGetting Your Venture "Game Ready" for Funding
Getting Your Venture "Game Ready" for Funding
 
Angel Investing
Angel InvestingAngel Investing
Angel Investing
 
Angel investing 101: An Introduction to Angel Investing Aug 2019 SS
Angel investing 101: An Introduction to Angel Investing Aug 2019 SSAngel investing 101: An Introduction to Angel Investing Aug 2019 SS
Angel investing 101: An Introduction to Angel Investing Aug 2019 SS
 
Lakeshore arch angels presentation 04 2013_ali
Lakeshore arch angels presentation 04 2013_aliLakeshore arch angels presentation 04 2013_ali
Lakeshore arch angels presentation 04 2013_ali
 
SAC Learning Series Angel Investing 101
SAC Learning Series Angel Investing 101 SAC Learning Series Angel Investing 101
SAC Learning Series Angel Investing 101
 
7 Tips to Get Angel Investors for Startup Business
7 Tips to Get Angel Investors for Startup Business7 Tips to Get Angel Investors for Startup Business
7 Tips to Get Angel Investors for Startup Business
 
Raising Capital from Life Science Investors
Raising Capital from Life Science Investors Raising Capital from Life Science Investors
Raising Capital from Life Science Investors
 
Funding basics - From Boots to Wings
Funding basics - From Boots to WingsFunding basics - From Boots to Wings
Funding basics - From Boots to Wings
 
MassChallenge 2011 Bootcamp Day 5: Finance
MassChallenge 2011 Bootcamp Day 5: FinanceMassChallenge 2011 Bootcamp Day 5: Finance
MassChallenge 2011 Bootcamp Day 5: Finance
 
MassChallenge Bootcamp
MassChallenge Bootcamp MassChallenge Bootcamp
MassChallenge Bootcamp
 
MassChallenge Bootcamp Day 5: Finance
MassChallenge Bootcamp Day 5: FinanceMassChallenge Bootcamp Day 5: Finance
MassChallenge Bootcamp Day 5: Finance
 
Insider's Guide to Raising Early-Stage Capital
Insider's Guide to Raising Early-Stage CapitalInsider's Guide to Raising Early-Stage Capital
Insider's Guide to Raising Early-Stage Capital
 
Fundraising Strategies – help investors find you
Fundraising Strategies – help investors find youFundraising Strategies – help investors find you
Fundraising Strategies – help investors find you
 
11.29 TCN Boston Funding Options Overview
11.29 TCN Boston Funding Options Overview11.29 TCN Boston Funding Options Overview
11.29 TCN Boston Funding Options Overview
 
Seed Funding and Venture Capital
Seed Funding and Venture Capital Seed Funding and Venture Capital
Seed Funding and Venture Capital
 
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...Know your Angels: What Entrepreneurs need to know about Angel Investors befor...
Know your Angels: What Entrepreneurs need to know about Angel Investors befor...
 
Startup Istanbul 2017 - Asra Nadeem - Angel Investing Basics
Startup Istanbul 2017 - Asra Nadeem - Angel Investing BasicsStartup Istanbul 2017 - Asra Nadeem - Angel Investing Basics
Startup Istanbul 2017 - Asra Nadeem - Angel Investing Basics
 
Angel Investor Groups | Startups.co
Angel Investor Groups | Startups.coAngel Investor Groups | Startups.co
Angel Investor Groups | Startups.co
 
Early Stage Fundraising
Early Stage FundraisingEarly Stage Fundraising
Early Stage Fundraising
 
Venture capital equity funding explained - Paula Mariwala, Seed Fund
Venture capital   equity funding explained - Paula Mariwala, Seed FundVenture capital   equity funding explained - Paula Mariwala, Seed Fund
Venture capital equity funding explained - Paula Mariwala, Seed Fund
 

Recently uploaded

2024-04-09 - Pension Playpen roundtable - slides.pptx
2024-04-09 - Pension Playpen roundtable - slides.pptx2024-04-09 - Pension Playpen roundtable - slides.pptx
2024-04-09 - Pension Playpen roundtable - slides.pptxHenry Tapper
 
ekthesi-trapeza-tis-ellados-gia-2023.pdf
ekthesi-trapeza-tis-ellados-gia-2023.pdfekthesi-trapeza-tis-ellados-gia-2023.pdf
ekthesi-trapeza-tis-ellados-gia-2023.pdfSteliosTheodorou4
 
Banking: Commercial and Central Banking.pptx
Banking: Commercial and Central Banking.pptxBanking: Commercial and Central Banking.pptx
Banking: Commercial and Central Banking.pptxANTHONYAKINYOSOYE1
 
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptx
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptxOAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptx
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptxhiddenlevers
 
2B Nation-State.pptx contemporary world nation
2B  Nation-State.pptx contemporary world nation2B  Nation-State.pptx contemporary world nation
2B Nation-State.pptx contemporary world nationko9240888
 
Building pressure? Rising rents, and what to expect in the future
Building pressure? Rising rents, and what to expect in the futureBuilding pressure? Rising rents, and what to expect in the future
Building pressure? Rising rents, and what to expect in the futureResolutionFoundation
 
10 QuickBooks Tips 2024 - Globus Finanza.pdf
10 QuickBooks Tips 2024 - Globus Finanza.pdf10 QuickBooks Tips 2024 - Globus Finanza.pdf
10 QuickBooks Tips 2024 - Globus Finanza.pdfglobusfinanza
 
Hello this ppt is about seminar final project
Hello this ppt is about seminar final projectHello this ppt is about seminar final project
Hello this ppt is about seminar final projectninnasirsi
 
Global Economic Outlook, 2024 - Scholaride Consulting
Global Economic Outlook, 2024 - Scholaride ConsultingGlobal Economic Outlook, 2024 - Scholaride Consulting
Global Economic Outlook, 2024 - Scholaride Consultingswastiknandyofficial
 
Demographic transition and the rise of wealth inequality
Demographic transition and the rise of wealth inequalityDemographic transition and the rise of wealth inequality
Demographic transition and the rise of wealth inequalityGRAPE
 
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshare
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshareAon-UK-DC-Pension-Tracker-Q1-2024. slideshare
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshareHenry Tapper
 
Introduction to Health Economics Dr. R. Kurinji Malar.pptx
Introduction to Health Economics Dr. R. Kurinji Malar.pptxIntroduction to Health Economics Dr. R. Kurinji Malar.pptx
Introduction to Health Economics Dr. R. Kurinji Malar.pptxDrRkurinjiMalarkurin
 
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτος
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτοςΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτος
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτοςNewsroom8
 
Thoma Bravo Equity - Presentation Pension Fund
Thoma Bravo Equity - Presentation Pension FundThoma Bravo Equity - Presentation Pension Fund
Thoma Bravo Equity - Presentation Pension FundAshwinJey
 
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdf
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdfZimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdf
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdfFREELANCER
 
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...Amil baba
 
Money Forward Integrated Report “Forward Map” 2024
Money Forward Integrated Report “Forward Map” 2024Money Forward Integrated Report “Forward Map” 2024
Money Forward Integrated Report “Forward Map” 2024Money Forward
 
What is sip and What are its Benefits in 2024
What is sip and What are its Benefits in 2024What is sip and What are its Benefits in 2024
What is sip and What are its Benefits in 2024prajwalgopocket
 
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptx
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptxTACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptx
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptxKathlynVillar
 

Recently uploaded (19)

2024-04-09 - Pension Playpen roundtable - slides.pptx
2024-04-09 - Pension Playpen roundtable - slides.pptx2024-04-09 - Pension Playpen roundtable - slides.pptx
2024-04-09 - Pension Playpen roundtable - slides.pptx
 
ekthesi-trapeza-tis-ellados-gia-2023.pdf
ekthesi-trapeza-tis-ellados-gia-2023.pdfekthesi-trapeza-tis-ellados-gia-2023.pdf
ekthesi-trapeza-tis-ellados-gia-2023.pdf
 
Banking: Commercial and Central Banking.pptx
Banking: Commercial and Central Banking.pptxBanking: Commercial and Central Banking.pptx
Banking: Commercial and Central Banking.pptx
 
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptx
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptxOAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptx
OAT_RI_Ep18 WeighingTheRisks_Mar24_GlobalCredit.pptx
 
2B Nation-State.pptx contemporary world nation
2B  Nation-State.pptx contemporary world nation2B  Nation-State.pptx contemporary world nation
2B Nation-State.pptx contemporary world nation
 
Building pressure? Rising rents, and what to expect in the future
Building pressure? Rising rents, and what to expect in the futureBuilding pressure? Rising rents, and what to expect in the future
Building pressure? Rising rents, and what to expect in the future
 
10 QuickBooks Tips 2024 - Globus Finanza.pdf
10 QuickBooks Tips 2024 - Globus Finanza.pdf10 QuickBooks Tips 2024 - Globus Finanza.pdf
10 QuickBooks Tips 2024 - Globus Finanza.pdf
 
Hello this ppt is about seminar final project
Hello this ppt is about seminar final projectHello this ppt is about seminar final project
Hello this ppt is about seminar final project
 
Global Economic Outlook, 2024 - Scholaride Consulting
Global Economic Outlook, 2024 - Scholaride ConsultingGlobal Economic Outlook, 2024 - Scholaride Consulting
Global Economic Outlook, 2024 - Scholaride Consulting
 
Demographic transition and the rise of wealth inequality
Demographic transition and the rise of wealth inequalityDemographic transition and the rise of wealth inequality
Demographic transition and the rise of wealth inequality
 
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshare
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshareAon-UK-DC-Pension-Tracker-Q1-2024. slideshare
Aon-UK-DC-Pension-Tracker-Q1-2024. slideshare
 
Introduction to Health Economics Dr. R. Kurinji Malar.pptx
Introduction to Health Economics Dr. R. Kurinji Malar.pptxIntroduction to Health Economics Dr. R. Kurinji Malar.pptx
Introduction to Health Economics Dr. R. Kurinji Malar.pptx
 
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτος
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτοςΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτος
ΤτΕ: Ανάπτυξη 2,3% και πληθωρισμός 2,8% φέτος
 
Thoma Bravo Equity - Presentation Pension Fund
Thoma Bravo Equity - Presentation Pension FundThoma Bravo Equity - Presentation Pension Fund
Thoma Bravo Equity - Presentation Pension Fund
 
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdf
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdfZimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdf
Zimbabwe's New Gold-Backed Currency- A Path to Stability or Another Monetary.pdf
 
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...
Uk-NO1 Rohani Amil In Islamabad Amil Baba in Rawalpindi Kala Jadu Amil In Raw...
 
Money Forward Integrated Report “Forward Map” 2024
Money Forward Integrated Report “Forward Map” 2024Money Forward Integrated Report “Forward Map” 2024
Money Forward Integrated Report “Forward Map” 2024
 
What is sip and What are its Benefits in 2024
What is sip and What are its Benefits in 2024What is sip and What are its Benefits in 2024
What is sip and What are its Benefits in 2024
 
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptx
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptxTACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptx
TACLOBAN-CITY-DIVISION-POPQUIZ-2023.pptx
 

Show Me the Money: Angel Investors and Angel Fundraising

  • 1. “Show Me the $$$$!”…Session 3: Angels! Insiders guide to Angels and Angel Investment General Assembly / RosePaul Investments Event Tom Wisniewski RosePaul Investments Tuesday November 19, 2013
  • 2. Agenda I. Kick-off and Introductions II. Intro to Angel Capital III. Investor Profile and Discussion • BREAK: Networking and Beverages IV. More on Angel Investors V. Best Practices: • WRAP-UP: Networking and Beverages 1 confidential
  • 3. Seminar Rationale: Why are you here?  Interested in finding Angels…. • Want advice and $’s to help my start-up  Interested in investing as an Angel…. • Want advice on how to get started and do it well  Curious what the hype on Angels is all about The Challenge…  “Lots of noise, lots of conflicting descriptions and advice”.  “Angels difficult to find”  “Angels challenging to engage …..and work with.”  Most Angel investments fail: tough on investors and start-ups …..”I have a lot of questions” 2 confidential
  • 4. However, there is a better way. So….. what helps?  Understand what Angel Capital is (and is not)  Understand who (and what) Angel Investors are  Understand the Angel Investment process …….learn some best practices on Angel Investments from some insiders and your fellow colleagues. 3 confidential
  • 5. Tom Wisniewski: My background  Born in NYC; grew-up in Montclair, NJ  Physics and Philosophy major undergrad (Clark University); MBA at Tuck School (Dartmouth)   1st Job: Programmer at Morgan Stanley then moved to Investment Banking After B-school: joined a start-up management consulting firm Mitchell Madison Group; focus on Strategy/Operations/IT for financial services, tech, outsourcing, private equity/VC clients (1993 to 2000)  Walker Digital: helped set-up and run an early “internet incubator” (2000)  Independent Advisor / Turn-arounds: Advised VC and PE Firms on portfolio company strategy and new investments; joined the management team of two companies  Currently: • Early stage investor and advisor to start-ups • Investor and advisor to VC and PE funds • Member and director at New York Angels confidential
  • 6. What would I like you to walk away with?  Better understanding of Angels and Angel Investing.  A set of specific insights that will *change* your approach.  A “to-do” list: starting point(s), actions, things to try.  A set of recommended resources to consult and learn more from.  A few new relationships with others in the NYC start- up/fundraising ecosystem: fellow entrepreneurs, investors, etc.  Answers to specific questions about pitching that you might have. 5 confidential
  • 7. So….what questions do you have about Angels and Angel Investing?  xxx 6 confidential
  • 8. II. Intro to Angel Capital 7 confidential
  • 9. Angel Capital: How it Fits in $100M IPO Strategic Partners $10M Venture Capital $1M Banks Angel Groups SBIR/STTR Grants Grants $100K Friends, Family & Fools Source: Tom Stephenson, Verge Idea Plan Angel Investors Prototype Beta Sales Profitability 8 confidential
  • 10. Early Late Deal Volume and Stage: VC’s vs. Angels Venture Capital Mostly later stage 3,400 deals $0.5-1.0B per Year Angel Capital 49,000 deals Mostly early-stage $20B per Year 9 confidential
  • 11. What does Angel Capital look like? Friends and Family (& Bootstrapping) • $10’s of K • Concepts? Plan only? • Not too many hard questions.. • No legal ? • Investing in YOU. • Know YOU already: Trust YOU.  Round Size: $100’s of K, up to $1M  Individual Angels Invest: $10K – 100K • Sweet spot: $25K to 50K  Valuation: Pre-Money valuations of $1-5M generally  Requirements: • B-Plan or “B-plan questions” answered • Key founders in place (tech and bus), full-time • Some product/ prototype done • Some market validation / traction: piloting? Paying? Customers • Legal structure and documents in place • Roadmap and plan for: Product, Market Expansion, Breakeven? Next Round of Financing? 10 confidential
  • 12. III. Investor Profile and Discussion  Drew Arlo, Entrepreneur, investor and fellow New York Angel 11 confidential
  • 13. IV. More on Angel Investors 12 confidential
  • 14. Who are these “Angels”? What do they look like?  Experienced, successful entrepreneurs: frequently multiple exits • Some from “tech-start-ups”, some from other businesses  Successful “corporate” business people: CEO or CxO-types  Older: most are in the 40-60 age group. • But there are also notable angels in their 20’s and 30’s e.g. newly minted start-up millionaires  3 – 10+ Angel Investments  ~10% of investible capital in Angel Investments  Differ *widely* in: Industry/Functional Experience, Investment Experience, Interests, Target Sectors/Stage, Investment $, Risk Tolerance, personal do’s/don’ts and hot buttons.  Lists? Not many. All are partial. AngelList? Gust? Other?  VC’s (vs. Angels): full-time job, invest other peoples $’s. Lifecycle: Raise $’s, Find/Evaluate, Invest, Manage Portfolio. Need big exits to make economics work 13 confidential
  • 15. Motivations: Why do they Angel Invest?  Passion. Have some strong affinity and interest in the industry, technology, business or entrepreneurs  Involvement. Have the time. Want to stay engaged and involved.  Giving Back. Have done well, now want to give back help fellow entrepreneurs. Support a cause or social mission.  Next Venture. Have exited. Looking for the next company to join, or next big idea. Serial entrepreneur  Go Pro. Have been an Entrepreneur. Looking to be a VC.  Financial Returns. Have exited and made a fortune. Want to invest and make more. 14 confidential
  • 16. How do Angels add value?  Feedback and Advice. On the business, on the pitch, on other investors.  Contacts. Introductions to customers, partners, team members, investors, and …..other advisors.  Experience. The wisdom of successes, and failures. Serial entrepreneurs. Other investments.  Capital….Duh!. Important, but.... …..and NOT (?): the common complaints.  Not Full-Time. Not a job.  Takes too long.  Ask a lot of questions.  Can’t / don’t follow-on invest.  “Like herding cats”.  Quality varies. 15 confidential
  • 17. Angel Groups (and Angels): How do they differ?  Member Profile: What does the “typical” member look like? What industries, sectors, companies do they come from?  Sector Focus. What types of companies are they investing in? • Internet, software (vs. Hardware vs. Pharma / Bio-tech vs. Clean/Green-tech) • B2C vs. B2B, Saas, Cloud-based, Content-based • How does their Portfolio compare to their stated strategy? • What is their “sweet spot”? Vs. their “also do”?  Stage. What is the target “stage” for prospective investments? What completed milestones and characteristics are they looking to see? • Revenues vs. Pre-Revenue? Product/Tech development? MVP complete? • Customer/market validation? Anchor accounts? User levels?  Valuations/ Investment Size: Pre-Money valuation range and size initial investment • “We typically invest $200 – 500K at valuations in the $1-3 Million level.”  Group Structure / Investment Decisions. How is the Angel Group structured? Most importantly, how are investment decisions made? Who makes them? 16 confidential
  • 18. Individual Investor Profile: Tom Wisniewski  Direct “Angel” Investor in Companies • $25K-250K investments; Typical valuations: $1-5 Million, • Typical Stage: at least some “product” done, some customer/sales traction • Sector focus: Opportunistic generally within internet/software space; - fair amount of Saas B2B, and consumer “marketplace” models, ecommerce enablers. - NOT (or not much?): hardware, heathcare/ pharma, cleantech • NYC based: 50% investments in NYC area companies; total of ~80% NE overall (e.g Boston, DC), 20% West Coast. • Examples: - Sociocast (social/behavioral big data analytics) - LiveLook (Saas, live collaboration sales/service platform) - Anvato (Ad insertion to live video streaming via proprietary machine vision) - Moveline (Uber for the moving industry) - Bizodo (Saas, paperwork automation; “Adobe 2.0” internet document sharing) - Movio (Digital “RedBox”; content delivery via “last 100 ft” of wifi internet) - HeTexted (Relationship advice forum generating content, media opportunities) - Wanderu (Kayak for ground transportation) - DealFlicks (a “Priceline” or “Hotel.com” for movie theater tickets) - iCharts (tool that enables engaging, sharable, embedible chart content)  Investor in Funds • In addition to direct investments in start-ups, invest in VC and PE funds. • Examples: - Social Starts (Seed fund for start-ups leveraging the Social Web) - Brooklyn Bridge Ventures (Charlie O’Donnell’s fund) - Entrepreneurs Roundtable Accelerator (ERA Fund) - Greycroft Partners (Venture Fund) 17 confidential
  • 19. NY Angels Profile www.newyorkangels.com  Member Profile: ~100 investor/members; several early-stage funds; Member backgrounds are generally representative of the tech / entrepreneurs / industries in NYC: software, e-commerce, ad-tech, finance, media  Sector Focus: Internet, e-commerce, new-media, software; B2C and B2B. Mostly NYC Area.  Stage. Mostly early stage (with some customers/revs), some pre-revenue  Valuations/ Investment Size: NYA pre-money valuations tend to range from $1M – 4M; investments tend to range from $250K to $1M+; • For larger rounds, NYA often leads the deal and helps find the rest of the capital by sharing/syndicating the deal with other Angel Groups  Group Structure / Investment Decisions. NYA core structure is as a group of individual investors. Individual investors “opt in” to deals and make their own investment decisions. • Typical member invests $25-50K in a deal. • In addition to the core “opt-in” model, NYA has just closed a small seed fund that will operate in parallel (using a “democratic model” for investment decisions)  History/Background. NYA has invested $45M+ in 70+ companies. • We are very active in the NYC entrepreneurial / early-stage ecosystem 18 confidential
  • 20. New York Angels Process: A Monthly Cycle 1. Proposals Reviewed Online (via Gust): 50 – 100 monthly • Sources: • NYA website/Gust (“cold call”: low prob of quality, and success) • Syndicated deal from other group/investor (warm intro: better quality, better success) • Referral from NYA member (warmer intro: even better quality/success) 2. In Person NYA Screening: ~15 companies monthly • Around 15 of the 100 are selected to present at an in person pitch/screening session (1st Wed of the month) • Companies have 10 min to pitch, 5 Q&A (5 minute investor discussion) • Usually ~40 NYA members attend 3. Discovery / Follow-up: 1-3 new companies enter monthly (3-6 in-process total) • Of the 15, 1-3 companies garner enough investor interest to move forward in some fashion • If there is sufficient interest from a core group of investors, and an investor willing to “lead”, then the core NYA process moves forward with follow-up “Discovery” meeting(s) aka deep dives, due diligence. • In some cases individual investors want to follow-up and explore the company further independently 4. Investment Breakfast: 1-3? companies monthly • Those Companies that get to the term-sheet stage with several committed NYA investors, are brought back to present to the NYA Group at the Breakfast • NYA Investment Breakfast meetings: 20 minute presentation + Q&A, 40-60 NYA members attending 5. Final Due Diligence, Legal Docs, Closing. confidential
  • 22. Some Best Practices for Angel Investors  Learn to Invest. Smarter you are, the better you invest. Learn from other Angels, VC’s, entrepreneurs, all the online opinions/resources. • Shooting from the hip, almost never works. • “Its like unprotected sex; fun while you do it, but afterward….” - Linda Holiday (Investor, Entrepreneur)  Know the Investment. Invest in things you have some “insider knowledge” of. • Leverage the talents and experience of other investors and experts.  Build a Portfolio. Angel investing is very risky, need to diversify across pool of investments • Typical “VC” Outcomes: Out of 10 investments made: - 3 Fail, return no money - 3-4 “Do OK”, provide a modest return, or return “most” of investment - 3 “Succeed and Exit”, 5-10x or more returns make up for the rest. Often it’s the “One”: the 100x that drives the entire return • Need 10 – 12 investments; more better. 21 confidential
  • 23. Some Best Practices for Angel Investors  Long-Term Commitment. Plan ahead; average hold-time of Angel Investment is 7+ years. • Reserve capital for follow-on rounds, • Reserve “patience” for all the speed bumps, pivots and crashes  Investment Structure Matters. [ GREAT COMPANY! ] + [….poor legal structure] = [ Little/No returns and Misery ] • Need to understand the key “terms”: term sheets, debt vs. equity • But too much legal = counter productive, useless?....  Valuation Matters. [ GREAT COMPANY! ] + […wrong valuation] = [ Followon problems, and Little/No returns ] • Most “good” exits are in the $10’s of Millions, a very few >$100M; • Repeat after me: “THERE ARE NO BILLION DOLLAR EXITS” 22 confidential
  • 24. A “Good” Pitch Looks Like: What one investor looks for… My (TW) Short List of What is Most Important 1) 2) 3) 4) Market Opportunity Product Traction Team Adapted from “10 Slides to an Awesome Pitch” by Dave McClure, 500 Start-Ups 1. Elevator Pitch 2. The Problem 3. Your Solution (Demo Here!) 4. Market Size 5. Business Model ($) 6. Proprietary Tech 7. Competition 8. Marketing Plan 9. Team / Hires 10. Money / Milestones TW: + Evidence of Traction!!!! Market Fit!!!!! http://www.slideshare.net/dmc500h ats/how-to-pitch-a-vc-sept-2010 23 confidential
  • 25. Key Success Factors and Advice for attracting Angel Investment  Pitch, Get Feedback, Revise. Repeat. No venture idea was built in a vacuum. The ONLY way to develop business ideas is to share them, solicit feedback, make adjustments, develop/refine/add and…..DO IT AGAIN! • Many ventures fail to gain investor attention because there are too many gaps (perceived and real).  Find Good Advisors. To get good, detailed feedback and input you need to be talking to right people, with the right experiences: Experienced entrepreneurs and investors, prospective clients and partners. • “Look for advisors. Find investors.” • How? Networking, networking, networking….  Communication is Paramount. Potential investors (or potential employees, customers, etc.) usually start out knowing nothing about you or you venture. Getting someone up to speed: a challenge. Getting someone to write a check: a big challenge. At the core is effective communication: • Written: Business Plan, “One Pager”, e-mails, pitch decks • In Person: Elevator Pitch, stand-up pitch presentation, video • ….just as importantly: formally developing these pitches/plans will improve/refine your actual business (its not just about telling your story to others) 24 confidential
  • 26. Key Success Factors and Advice….continued  Find Investors that Fit. As a general rule, people invest in things that they understand and have experience with; find Angels that come from industries, sectors, etc. that are same/similar to your venture and the customer markets it serves. • If I have never invested in Caribbean real estate, oil wells….or communication hardware, it is very unlikely that I will do it with you. • For Angel Groups: use online bio’s / LinkedIn to identify likely “good fit” Angels  Find “Lead” Investor(s). Its critical to get one or more investors on board who can take the lead in driving the investment process: due diligence, term sheet, investor commitments, closing documents/process • Investors trust…..other investors. Their interests are aligned. Lead investors help attract additional “followers”. With Angel Groups: use available bios / LinkedIn to  Understand (and Manage) the Process. You are more likely to succeed if you really understand what’s happening (or should be happening) For each step (e.g. investor search, screening, presentation, due diligence, term sheets, etc.): • What is happening or needs to? • Why? What’s the rationale? • Who is doing what? How do perspectives and motivations differ? • ……now, what can I do to make it work for me? 25 confidential
  • 27. Key Success Factors and Advice….continued  Valuation (and Key Terms). Be realistic. Be Flexible. Realize this is a professional (not personal) discussion ; there will be back and forth. Ultimately the “market” sets the price/terms. • There is more to investment terms than valuation….Important to understand.  Timing. Am I ready for Angel Investment?......A few probing questions: • Have you covered the key success factors mentioned here? Do you have a compiling business opportunity with huge growth potential? • Do you really need the money? Now? The more that you can accomplish on your own, the more compelling your case (and valuation) will be….. • Are you ready to work for a someone else? e.g. the investors, the board of directors • Fund raising is “brain damage”. It wastes valuable time that could be spent growing the business. Avoid it, minimize it, delay it if you can. 26 confidential
  • 28. Thanks! Thomas Wisniewski Contact Info Email: thomas@rosepaul.com LinkedIn: http://www.linkedin.com/in/thomaswis Twitter: @thomaswis This presentation: http://www.slideshare.net/Thomaswis/ New York Angels www.newyorkangels.com New York Angels Educational Meetup: http://www.meetup.com/NY-Angels/ 27 confidential