In the startup and early stage ecosystem, nothing has been as democratised as angel investing. This kind of of private equity investing has in the past always been reserved for high net worth individuals, and now with angel syndicates and many other inclusive resources, anyone can! Let's explore.
When embarking on an investment journey, multiple consultations and copious amounts of research are expectedly performed as part of the due diligence. Although until a few years ago deemed investment solely for high-net-worth investors, angel investing, a type of private equity investing, has become the most inclusive and affordable route to invest in technology and other startups in exchange for equity of the business. Do you need to be an accredited investor in order to angel invest? Is $1000 enough to deem one an angel investor, and can the amount invested be lower? What value do angel group syndicates offer? When is the right time to start? These are some of the questions that I asked myself, and this article will unpack some of the answers to these questions and more.
Here are the 5 resources you need to access as you embark on your angel investing journey.
- Angel Investing and Venture Capital Lecture by Dr Ola Brown
Delivered by Dr Ola Brown, founder of the Flying Doctors Healthcare Investment Company (FDHIC), the series of lectures in Angel Investing and Venture Capital offer beginners an introductory overview into this lens of investing. Dr Brown cover topics such as Deal Sourcing, Valuation and Due Diligence to Portfolio Construction and Management, and lessons learnt from cases of previous investments. Access the lecture here.
- Angel Syndicates (or Networks)
Group economics through angel investments has been an instrumental tool of inclusive economic participation for aspiring angel investors, and these are called angel syndicates. Simply put, angel syndicates manage a network or membership of a group of (experienced and beginners) angels who have their deal interests managed through the syndicate with deal flow, due diligence and transactions, enabling the investors to make investments at their own discretion through live pitches (usually monthly). Here a few examples of syndicates:
Podcasts have become one of my favourite ways to consume content about any topic, from angel investing to impact development and even the occasional current affairs update on my business interests. Recommendations for podcasts that you listen and learn from, include:
- Angel Investing Platforms
Some of the cons of joining an angel syndicate or network is that sometimes, you have to be an accredited investor, as well as pay an annual or quarterly subscription paired with a minimum investment(s) to be made per annum and/or per investments per cycle. This is where companies like WeFunder, a crowdfunding platform that allows for angel investors to invest in startups from across the globe and sectors, come in. Investors can invest from $100. Other globally recognized angel investing platforms include:
- Angel Investing: Start to Finish by Joe Wallin and Pete Baltaxe
One of the most lauded books on angel investing, Angel Investing: Start to Finish is a book by early-stage and startup ecosystem veterans, Joe Wallin and Pete Baltaxe offering “comprehensive practical and legal guide written to help investors and entrepreneurs avoid making expensive mistakes.”
The book also offers previews to the following modules:
- What Angels Do
- Finding Opportunities
- Term Sheets and Definitive Documents
- The Interplay of Valuation, Ownership, and Dilution
Access the preview, and the table of contents of the book here.
There are many names that Angel Investing and Investors inhabit, whether as a private investor, seed investor or angel funder, at the crux of the matter and what’s important to take note about this asset class, is that it is an investment, even if you’re investing from $10 through a platform or $100000 as a high net worth individual, risk exists and just because its minute amounts or the investments are happening during early stages of development, you are not less cushioned from risk.
Are there any other resources that have helped you along your angel investing journey? I’d love to hear about them.
Disclaimer: The information and publications are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort offered or endorsed by www.vdubese.com .