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DEFINING YOUR ANGEL STYLE
by Kathleen Murray, McMorran Strategists, LLC on 7/7/2014

At Executive Forum Angels in metro NYC area, we are like many angel groups with 15- 20% experienced angels, 15- 20% who will probably not ever make an angel investment and the other 60 - 70% figuring out what it means to make their first angel investment. The key success factor for individuals in each category is to define their own angel style...and redefine their style as they continue to invest and learn.

What is meant by angel style? It includes factors such as:

* Risk profile – the most critical of factors. All types of angel investing are risky so being ready to lose one’s contribution to a firm is a good place to begin. If a person cannot emotionally or practically deal with this, they should not even be an angel.

* Stage of the firm seeking angel funding – Firms often seek angel funding when they just have an idea/rough business plan (Seed) or they have a product/service ready to go to market (Early Stage) or are already marketing their product/service (Early Stage with traction or revenue). This contributes to the risk profile with Seed being the riskiest of angel funding.

* Engagement – This is how much the entrepreneurs seeking funding want angels to be engaged as advisors or board members, or not. And how much the angel wants to be engaged with the firms. There are some angels who only want to contribute funds.

* Industries – For each industry, there are a wide range of startups. And even within an industry, the startup firm could be addressing marketing, technology, product, etc. There may be some industries with which an angel is just not comfortable in investing due to personal or socially responsible values.

This list is not exhaustive. It is a good outline for the accredited investors “dipping their toes” into the sea of startups...and even for experienced angels, it is a good list to review as one’s portfolio develops and the external environment changes.

Here are a few ways to develop and continuously redefine your style:

* Join an angel group which includes educational events
* Attend as many pitch days, accelerator presentations and entrepreneurial showcases as possible
* Read books, blogs and articles about angel investing and entrepreneurship
* Invite other angels to share their own styles and stories with you

Knowing your angel style should make you a better angel by improving your decision process and the efficiency of your investing. It also allows you to clearly define for entrepreneurs seeking funding what types of opportunities you are seeking. Know yourself in order for others to get to know you...

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