1. The Rise of the Angels
Naval Ravikant
AngelList
✌
angel.co

2. “All great truths begin as blasphemies”
- G.B. Shaw

3. The Venture Industry
has already changed

5. The Rise of the Angels
Entrepreneurs

6. Entrepreneurs gain Leverage
• Cheaper
• Incremental
• Incubators / Combinators
• More hit-driven
• Transparency
• Mostly Seed and Consumer

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

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

19. “Trust in Allah - but tie your camel”
- Arabic Proverb

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