david cohen's talk on angel investment
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TRANSCRIPT
Hi. I’m David Cohen.
@DavidCohen
I’m going to talk aboutAngel Investing
39 companies in 3 years
30 angel or venture backed
iContact
Everything I’m about to say could be wrong
Stop. First, should you raise money?
Angels or VCs?
How Much Do You Want To Raise?
Angels or VCs?
Recognize that for most of you raising angel investment will be very difficult.
Usually Difficult
Many of us will fail
The point?
Do not take this lightly. It must be a priority
or you will almost certainly fail.
Rule #1: Do or do not, there is no try
Angels and VCs: What’s the difference?
First, let me assure you....
There is a difference
Angels and VCs: What’s the difference?
Angels and VCs: What’s the difference?
Amount of money invested per deal.
Angels and VCs: What’s the difference?
WHERE probably matters more.
Some have never even entered the tournament.
Angels and VCs: What’s the difference?
They may be coming from very different places.
Angels and VCs: What’s the difference?
“Why do you do angel investing?”
“Mental exercise”“Giving back”
“Being a part of something”“Improving the ecosystem”
“I enjoy being a mentor”
oh, and sure...
“Making money”
Angels and VCs: What’s the difference?
What do angel investors look for?
★Potential for a large return.★Great entrepreneurs.★Strong business plan.★Exit strategy.★Go to market strategy.★Unfair competitive advantage.★Good valuation.★Strong advisors/co-investors.★External validation.★Scalable business model.★Low capital needs.
What do angel investors look for?
★Potential for a large return.★Great entrepreneurs.★Strong business plan.★Exit strategy.★Go to market strategy.★Unfair competitive advantage.★Good valuation.★Strong advisors/co-investors.★External validation.★Scalable business model.★Low capital needs.
Secret Economics of the Angels
Great Entrepreneurs
★“There are three things I look for as an early stage investor”
Great Entrepreneurs
★“There are three things I look for as an early stage investor”
★The team★The team, and finally★The team.
What do angel investors look for?
★Potential for a large return.★Great entrepreneurs.★Strong business plan.★Exit strategy.★Go to market strategy.★Unfair competitive advantage.★Good valuation.★Strong advisors/co-investors.★External validation.★Scalable business model.★Low capital needs.
Blah, blah, blah.
I’m going to take a different approach.
What do angel investors look for?
Resources:http://bit.ly/cohensingapore
What is the RIGHT way to approach angel investors?
“Why do you do angel investing?”
“Mental exercise”“Giving back”
“Being a part of something”“Improving the ecosystem”
“I enjoy being a mentor”
oh, and sure...
“Making money”
Remember the motivations
How to approach angel investors
If you want money, ask for advice.
If you want advice, ask for money.
Be thoughtful.
How to approach angel investors
How to approach angel investors
Recognize that it is a relationship.
Corollary: Never ask for money in the first meeting. Probably not in the second or third meeting either.
How to approach angel investor
What is the goal of a first meeting?
How to approach angel investor
What is the goal of a first meeting?
The get a second meeting.
Have you seen this?
You are pitching to a room full of strangers
RUN AWAY!
How to approach angel investor
Remember the motivations.
Angel investors generally invest because they develop a meaningful relationshipwith the entrepreneur.
Remember the motivations.
Desire to mentor. To be a part of something.
To get mental exercise.
This is what you covet
Do you have an advocate?
I’ve been working with these guys.
Do You Have A Lead Investor?
I've Got Maybe's, Now What?
The other two thirds
I Can't Get <Person> To Return My Phone Call
Everyone Passed, Now What?
What Happens If I Don't Raise Money?
Learn more:
@DavidCohen@TechStars
What do angel investors look for?
http://blog.guykawasaki.com/2005/12/the_102030_rule.htmlhttp://blog.guykawasaki.com/2006/01/the_top_ten_lie_1.htmlhttp://headrush.typepad.com/creating_passionate_users/2006/12/dont_make_the_d.htmlhttp://blog.guykawasaki.com/2006/01/how_to_be_a_dem.htmlhttp://www.secondderivative.com/Reading.htmlhttp://www.demo.com/demoletter/how_to_give_a_great_demo.phphttp://www.Demo.comhttp://www.demo.com/demonstrators/demo2006fall/79781.phphttp://www.demo.com/demonstrators/demo2006fall/79986.php