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Turn the Table: What’s an Angel Look Like?

By: Dave Berkus

 

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Angel investors, particularly those in organized angel groups, are typically former entrepreneurs who have had successful liquidity events in their pasts, or executives of companies who’ve retired with the funds from their stock options. Occasionally, an angel is a member of a wealthy family, having little experience managing a business. But most often these angels are skilled at growing companies, calling on their past experience to evaluate and then help entrepreneurs in their early stages of growth.

 
Several times in our angel group, one of the largest in the United States, we have queried our group as to their motives in being active, risking their money, taking their time to research, perform due diligence and then coach entrepreneurs of young companies. The result of these surveys over time is universally the same.  Although most every angel member joins a group to find great investments that will make money for the investor-member, all have other, sometimes more personally important goals. These include giving back to the community in the form of time and investment, or learning about new industries, new advances, and a generation of new ideas. Members want to socialize with those who have similar backgrounds and interests. And members want to participate in the creation of the excitement they universally once felt in the growth and ultimate liquidity event they experienced with their previous company.
 
Angels come from technology, real estate, medical specialties, and many other industries, bringing a wealth of experience to the table to help evaluate and then coach entrepreneurs. So how an angel responds to your pitch depends upon his or her background. You should try to find a way to get information about your audience before or even when standing in front of them. What industry specialties do they like, or where did their experience come from? Do you know any people in common? Are they interested in your industry either to be educated or to share their skills and experiences?
 
Connecting with these people often requires a bit of effort. Networking events are great starting points. Although many of these angels will appear standoffish at the start, if you can find some information from one or more of them before making your pitch, you will be in a far better place to succeed when pitching your idea to an individual or a group.
 
This article was originally published by Berkonomics
Published: July 9, 2014
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Dave Berkus

Dave Berkus is a noted speaker, author and early stage private equity investor. He is acknowledged as one of the most active angel investors in the country, having made and actively participated in over 87 technology investments during the past decade. He currently manages two angel VC funds (Berkus Technology Ventures, LLC and Kodiak Ventures, L.P.) Dave is past Chairman of the Tech Coast Angels, one of the largest angel networks in the United States. Dave is author of “Basic Berkonomics,” “Berkonomics,” “Advanced Berkonomics,” “Extending the Runway,” and the Small Business Success Collection. Find out more at Berkus.com or contact Dave at dberkus@berkus.com

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