Comments on: Angels: Development or Momentum?

By: giffc

giffc — Wed, 20 Jan 2010 04:10:26 +0000

Thanks Nivi, I appreciate your weighing in, and once again for creating a great resource over at Venture Hacks.

By: nivi

nivi — Wed, 20 Jan 2010 04:01:45 +0000

It depends on your relationship with the angel.

If you're already buddies with the angel, start talking early. Reserve this for angels who will meet with you once-a-month no matter what you're up to.

If you're not buddies and you have a monster intro ,you could still try to do angel development. Otherwise, wait to play the momentum game.

Either way, send your pitch to AngelList: http://venturehacks.wufoo.com/forms/x7x3p9

By: giffc

giffc — Sat, 16 Jan 2010 17:55:05 +0000

good stuff Jason, thanks for sharing your thoughts

By: Jason Cohen

Jason Cohen — Sat, 16 Jan 2010 17:20:11 +0000

My thoughts, briefly (i.e. sans rationale):

1. Once you start raising money, you need to set a time limit and push hard.
2. It's OK to talk to people you already know remotely, but pitching — as in a deck — should never be done remotely. Totally different impact and feedback.
3. Pitch a lot of people at once (see Venture Hacks blog for details.)
4. Practice your pitch first with “friendly” Angels who can grok that you're “alpha-testing” your pitch. Meaning they'll be frank but can also forget the old pitch later. “Practice” isn't so much about memorizing text so much as getting solid answers to the important questions.
5. The hardest money to get it person #1. After that it's actually quite easy, and in fact #1 might help you find those people. Angels & VCs are absolutely lemmings.
6. In your deck, showing progress/learning is more important than predictions.

By: giffc

giffc — Sat, 16 Jan 2010 00:42:09 +0000

Thanks for the input Kevin. Yes, I have my short A list, most of which I know at this point, but a couple that I don't yet but am being introduced to by good people. My take has always been that it's a relationship you build, and that you don't start by talking about raising money at all but rather just getting feedback on the business. My view has been that if someone wants to bank on me and bank on the business, 2 weeks won't make a difference… it's the relationship building and showing progress that counts. It was interesting hearing the opinions to hold off and I thought that I would post about it in the spirit of transparency.

By: Kevin Dewalt

Kevin Dewalt — Sat, 16 Jan 2010 00:07:17 +0000

Giff,

This may be a matter of personal style and you may have already done this. Or it may be irrelevant depending on the size of the "seed" money you are pursuing. If so, I'll suggest it anyway for the benefit of your readers.

I place a huge emphasis on the person. In other words, I'd be asking "who" before "when". I would try to identify 2-3 people I absolutely positively would want as a first investor in the deal based on their experience, industry knowledge, focus on a particular sector, reputation with other entrepreneurs, etc.

I would then approach them and explain why I wanted to talk to them first.

You would be surprised how rare this is - for entrepreneurs to really perform due diligence on seed investors to seek the right strategic match. It becomes shockingly obvious after spending time on the deal side.

My guess is that this approach will mitigate any timing issues.