Category Archives: Venture Capital

Angel Investing – Ringing in the New Year 2017

2017 Capodanno Natale 1It’s that time once again to reflect on the prior year and make some resolutions for the next. In last year’s post, I suggested that you:

  • Take a critical look back at portfolio companies that didn’t make it and try to ascertain what really went wrong.
  • Expand your access to quality deal flow
  • Become a mentor to a young entrepreneur

Here are a few of my suggested resolutions for 2017:

Have a plan.  When we meet with entrepreneurs regarding a potential investment in their company, we usually want to know how they “plan” to build their business. As angels, we should go through the same process when deciding how we want to build our portfolio in the coming year. Do you prefer to invest as a solo angel, as part of an organized angel group or perhaps through a fund or online platform. Is there a specific focus or outcome that you want to accomplish through your investment in early stage companies? For me, changing the ratio by increasing the capital flowing to women entrepreneurs continues to be a pivotal part of my investment strategy. In my recent post – Angel Investing – Invest in Women, I have outlined how I hope to execute on this plan going forward.

Approach the process with a positive versus a negative lens. When I attend screenings run by the various angel groups with which I am involved, my goal is to try and find some exciting opportunities in which to invest as opposed to finding a reason to reject every investment opportunity presented. Several years ago, I attended a presentation by Sigal Barsade, a Wharton management professor who studies the influence of emotions on the workplace. She discussed the concept of “emotional contagion” and the influence it could have on group behavior – both positive and negative. I am not advocating not doing rigorous due diligence on investment opportunities, but rather focusing on finding great investment opportunities.

Get involved in the startup ecosytem. Whether through activities sponsored by startup accelerators, universities, or other agencies, get involved – it’s a great way to meet entrepreneurs as well as other early stage investors. You can act as a mentor, help judge a startup competition or participate on a panel addressing topics of importance to both entrepreneurs and investors.

HAPPY NEW YEAR!

Angel Investing – A Note on Notes

Business Concept: Close-up the Funding button on the keyboard and have Lime, Green color button isolate black keyboardThere are a variety of funding options for entrepreneurs to consider as they explore taking in external capital. For investors, understanding the pros and cons of these various funding options and how they fit into a company’s overall funding plan is critical. One option, a Convertible Note, is a hybrid structure that is used as a bridge to a future equity round. In addition to a stated interest rate and maturity date, Convertible Notes will have conversion terms that outline how the notes will be repaid or converted into equity. The amount of equity that a company needs to raise to trigger the conversion of the notes is referred to as the qualified equity financing. Historically, I have seen this form of funding used primarily in pre-seed rounds where the company needs to raise a small amount of capital to get to proof of concept as well as a bridge financing between a Series A and B round in order to provide the company with a bit more runway to get to the metrics required by a Series B investor. Continue reading

Angel Investing – Twelve Days of Christmas 2015

12 days of christmas: 12 Snowflakes

On the first day of Christmas
a founder shared with me:
A Term Sheet for Series B Continue reading

Angel Investing – Financial Projections – “Cash is King”

Cash is King Shopping Money Vs Credit Buy Power CurrencyAs an angel investor, I see lots of financial models, which range from the very simple to the extremely complex. I am often asked why I insist on seeing the actual model ( yes the excel not the pdf version) as it all based on layers of assumptions. In response, the financial model is nothing more than a quantitative expression of the business model and in fact what is most important to me are the assumptions that underlie the numbers. Continue reading

Angel Investing – Avoiding “Energy Vampires”

focus on solutions conceptEarlier this week, I was listening to an NPR program on “energy vampires”, those special individuals whose interactions can literally drain the energy from us.  The term “energy vampires” was coined by Dr. Judith Orloff, a clinical professor of psychiatry at UCLA in her book Positive Energy. Now everyone has had some experience with “energy vampires” – those special people who cause some of the following reactions:

  • You hope a call to them goes directly to voicemail
  • You need a trip to Starbucks before and after meeting with them
  • You would rather have a root canal  (the extreme version)

You get the point…… Continue reading

Angel Investing – “Bringing Tech Education to ALL Women”

??????????????????????????????????????????????????????????This past weekend, I had the opportunity to invest in a crowd-funding campaign for Bella Minds – whose mission is quite simple – “Bringing Tech Education to ALL Women”.  There is lots of press these days on the lack of women in STEM… so rather than just read/write about the problem, this was an opportunity to participate in an actual solution; yes do something! Continue reading

Angel Investing – “Love Notes”

????????????????????????Recently Rob Delman, a colleague of mine at Golden Seeds, and I were discussing the best ways to structure an investment in an entrepreneurial venture started by your children.  As we both have “twenty-something” children who have been exposed over the years to our work in angel investing, it is only natural that they approach us as potential funders of the next great thing! Continue reading